Spring Budget: Calls to raise Employment Allowance and VAT threshold
With just one week to go until the Chancellor delivers his Spring Budget, Federation of Small Businesses (FSB) National Chair Martin McTague said that Chancellor Jeremy Hunt needs to show the country he can take “practical” steps to improve the environment for SMEs. FSB’s asks include measures to cut the tax on jobs by raising the Employment Allowance from £5,000 to £6,500 to align it with the increase in the National Living Wage and raising the VAT threshold from £85,000 to £100,000. Other calls include bringing in tax-free shopping for international visitors and a fresh look at access to finance, with the Recovery Loan Scheme expanded. This was covered by City AM.
Treasury Committee report highlights scale of ‘debanking’ among SMEs
The Treasury Committee has released data on the number of bank accounts belonging to small and medium-sized businesses as part of its inquiry into SME finance – 140,000 accounts were closed in the last year, the Committee said, equivalent to 2.7 per cent of small business accounts. FSB’s Martin McTague spoke about the issue on Wake Up To Money, and told Sky News: “Having your bank account closed suddenly - with little to no notice - is immensely disruptive to a small firm. You can't pay staff or suppliers, while incoming funds will be delayed, putting pressure on cashflow and your ability to continue trading at all.” FSB has been calling for the Financial Conduct Authority (FCA) to compel banks to publish data on debanking on a quarterly basis, and to ensure that banks provide business customers with as much information and notice as possible, along with a defined appeals process.
FSB meets with Shadow Chancellor ahead of Spring Budget
On Wednesday, FSB welcomed the Shadow Chancellor, Rachel Reeves, and Shadow Business and Trade Secretary Jonathan Reynolds to its Westminster Office, to meet with leading business organisations ahead of next week’s Spring Budget. During the meeting, which was chaired by FSB Policy Chair Tina McKenzie, FSB raised the importance of improving the economic environment for small businesses. Other attendees of the meeting included the British Chambers of Commerce, The Institute of Directors, The Confederation of British Industry, and Make UK.
Tourist tax needs the chop
FSB continued to back the campaign to scrap the tourist tax for international visitors by signing a letter by hotelier Sir Rocco Forte, calling on the Chancellor to introduce the VAT rebate for tourists. Other signatories include representatives from Kurt Geiger, British Airways, and Harvey Nichols. FSB’s Chief of External Affairs, Craig Beaumont, told the Daily Mail: “It’s time for this tax to get the chop.” Last month, FSB teamed up with the British Chambers of Commerce (BCC) and Heathrow Airport to launch the campaign ahead of next week’s Spring Budget. Elsewhere, FSB Scotland joined forces with the Scottish Chambers of Commerce and Heathrow Airport to produce a Scotland-specific letter to the Chancellor, signed by a number of Scottish firms. Colin Borland, Director of the Devolved Nations, said: “This will bring in more visitors, more spend, more growth and prosperity, more jobs and more consequential tax revenues for the Treasury.”
Royal Mail: Cutting deliveries will damage economy
FSB told the i that scaling back Royal Mail deliveries could cause “real disruption” by damaging small businesses that rely on next-day and Saturday delivery services. This comes off the back of last month’s Ofcom report, which said the postal service is “getting out of date” and suggested ways to modernise it – such as scrapping Saturday deliveries. FSB member Alyssa Smith told the paper the damage to her jewellery business would be “monumental.” FSB policy Chair Tina McKenzie said: “Trading essential services for short-term savings is a slippery slope.”
Bank of England announces His Majesty King Charles III banknotes issuance date: 5 June 2024
Banknotes carrying a portrait of the King will be issued for the first time on 5 June. The portrait of the King will appear on existing designs of all four banknotes (£5, £10, £20, and £50), with no other changes to the existing designs. Polymer banknotes that feature the portrait of Her late Majesty Queen Elizabeth II will remain legal tender and will co-circulate alongside King Charles III notes. The new banknotes will only be printed to replace those that are worn, and to meet any overall increase in demand for banknotes. FSB recently became a strategic partner of the Bank of England’s Banknote Checking Scheme, to help small businesses avoid counterfeit banknote fraud.
Companies House fees increasing
Companies House is increasing a number of its fees from 1 May. Same-day incorporation will increase from £30 to £78, while a paper confirmation statement will increase from £40 to £62. The digital incorporation fee for a company or a limited liability partnership is rising from £10 to £50. The full list of new fees can be found on the Companies House website.
Making the most of trading with Australia and New Zealand
The Department of Business and Trade (DBT) is inviting business owners to attend its upcoming roadshows in March on exporting to Australia and New Zealand. Events will take place in London, Birmingham, Belfast, Cardiff, Manchester, and Dundee, with topics spanning from making the most of free trade agreements (FTAs) to exporting opportunities available in these markets. You can find more information and register your interest in attending the roadshows on DBT’s website. If you already sell or export your goods or services to Australia and New Zealand, or are investing in these markets, DBT would like to hear how the new FTAs are affecting your business through a short online survey. You can also email [email protected] to join an online feedback session on 12 or 20 March.
MoJ legal claims survey
The Ministry of Justice (MOJ) is calling on small firms to take part in a survey exploring how to improve the early pre-action resolution experience of those making a legal claim for over £10,000. The survey runs until 11pm on Sunday 10 March and is open to those who are thinking about making a claim, in the process of doing so, or those who have proceeded down a different route.
Sign up to receive the Weekly Brief direct to your inbox
Keep up to date with all the latest small business news each week by having the FSB Weekly Brief sent directly to your email inbox.