SME bosses 'confused about tax reforms'

28/02/2008

Most bosses at small and medium-sized enterprises (SMEs) around the UK are confused by the changes to the tax system that have been proposed ahead of the government's next budget.

Next month, Alistair Darling will deliver his first budget as chancellor and almost nine out of ten SME managers are unsure of what to expect if some of the planned tax reforms are introduced, according to a poll by Alliance & Leicester.

Some of the reforms that could be brought in include changes to corporation tax rates and capital gains tax, while increases in fuel duties are a major concern for many small firms.

Cashflow problems have been affecting SMEs around the country in recent months, which has led some to investigate other funding options such as invoice discounting and according to the latest research most are worried about how their business might be impacted by tax reforms.

"With economic uncertainty, small businesses are starting to feel the pinch and the Budget is another concern for the UK's 4.5 million SME population," said Steve Jennings, director of business banking at Alliance & Leicester.

The Challenge Finance company recently reaffirmed its aim of enhancing its presence within the UK's "vibrant" factoring market.