Weighing up the Pre-Budget Report
Article Date: Nov 25 2008Is the PBR an early Christmas present for businesses, or will it bring on a Boxing Day-style hangover? We ask entrepreneurs and experts for their verdict.
Borrowing binge
‘Given that the Chancellor is borrowing so much, the money could have been better spent. I’d have preferred to see the £15 billion’s worth of VAT reductions used to reduce the basic rate of income tax, which would have done a lot more to stimulate consumer demand’
Martin Warner, founder, Talkbiznow.com
Delayed pain
‘There will be future pain for businesses from the national insurance and tax changes, but the PBR does offer some help through the immediate difficulties of the recession. The question that hangs in the air is whether the Chancellor’s gamble will pay off’
Andy Hardy, development director, TaxCalc.com
VAT chance
‘The PBR will have some effect on stimulating the economy, but the main measure – a reduction in VAT – is not the best way of achieving this. A cut in corporation tax or national insurance contributions would have been more effective’
David Kern, chief economist, British Chamber of Commerce
Pay later
'Our board is still reviewing all the fine print, but if businesses can effectively convert taxes they owe into an eight-year interest-free loan, that would be fantastic. We've got payments of about £70,000 next month in VAT, PAYE and so on and if we could flip that over into an interest-free loan it would give us capital to invest in the business'
Dan Scarfe, CEO, Dot Net Solutions
Christmas giveaway
‘Targeting fiscal incentives at low-income households may help at the budget end of retail, but otherwise its impact on businesses will be marginal. When the US put a similar measure in place a very high percentage of the extra money was saved rather than spent’
Mary Monfries, head of entrepreneurship, Pricewaterhouse Coopers
Limited largesse
‘The government should have allowed full loss carry back for three years [rather than impose a £50,000 limit] and extended group relief to associated companies’
Elizabeth Small, tax partner, Halliwells
Show me the money
‘On the face of it there is a massive pot of up to £3 billion available to the UK’s growing businesses. The big question is how, how much and how easily they get their hands on it’
Tony Cohen, head of entrepreneurship, Deloitte
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