All talk, no trousers Darling
Founder of email marketing business Sign-up.to Matt McNeill delivers his damning Budget verdict
So, Mr Darling has delivered his first budget and for small businesses it means… well, more of the same disappointments that us entrepreneurs have come to expect.
Wading through the hype and misdirection, the real message is that small businesses face an increase in corporation tax to 21% (neatly compensating the exchequer for the reduction to 28% for larger companies, which is, of course, what they talked about). Coupled with the increase in capital gains tax to 18% and new powers for the HMRC to investigate businesses, it’s hardly creating an encouraging environment for business.
This follows the consistent theme that I’ve picked up over the last decade of running my own businesses – an ever increasing burden of red tape which makes it ever more difficult to do business, accompanied by increasing taxes and constant government claims to be doing more to support small businesses.
The government touts enhancements to the Small Firms Loan Guarantee Scheme and R&D Tax Credits (ever tried getting either of those? Good luck.) Meanwhile we have to deal with VAT, National Insurance, PAYE, Pensions, Business Rates, Corporation Tax and enough form filling to occupy weeks of valuable time.
Is this helping to create a thriving UK economy that encourages entrepreneurship? Hardly. Anyone looking to start a new business that’s going to employ anyone has a huge burden to face. Frankly, there are now some much more appealing options out there for the adventurous entrepreneur.
Working in the hi-tech field, my companies have the benefit of being highly mobile – where we’re based really doesn’t matter as long as we have connectivity. The appeal of a location like Dubai, with top-class facilities, government bodies that actually seem to want you to do business there and no corporation or income tax is now seeming like an ever more attractive option. Yes, there’s all that sunshine and those beaches to put up with but I’m sure I’ll be able cope somehow. Even looking closer to home, a short hop over to Ireland offers substantial advantages now.
The government needs to realise that as business becomes ever more global, if the UK doesn’t offer a more competitive environment we’ll undoubtedly face a real and rapid drain of innovative companies, and accompanying jobs, from the UK economy. Time to stop talking and start doing.
Serial entrepreneur Matt McNeill is founder and CEO of email and mobile marketing business Sign-up.to as well as e-ticketing company eTickets.to