New agency would be great news for small businesses
It’s been a very positive few weeks for small businesses and freelancers in the UK.
First up, the EU announced a new directive allowing member states to simplify accounting rules for their smallest businesses. Then, the Office of Tax Simplification (OTS) revealed a host of its own proposals to help ease tax and accounting burdens on small businesses, and provide better communication with HMRC over tax issues.
And now the Federation of Small Businesses (FSB) has also joined the fray, to call on the Government to create a specific Small Business Administration agency to promote the interests of the UK’s small business sector.
Modelled on a counterpart agency that represents small businesses in the USA, this new agency would have its own seat in the Cabinet - and the FSB believes it would help improve business opportunities for small firms and provide greater support during uncontrollable circumstances, such as last year's riots.
It’s a great idea in theory, and I think the more that can be done to help small businesses get the support and assistance they need, the better. Although we have a very active Minister for Small Businesses (Mark Prisk), he is not a member of the Cabinet - so the FSB’s proposals would certainly help give more weight to promoting small business issues in the very heart of Government.
But I also think that if such an agency were to be set up, it’s vital that it be staffed by people who actually have experience of running a small business or working in/with small businesses. Or, if it can’t be staffed by people who posses this specialist knowledge, then at the very least it would have to have a team of experts from the small business sector that it can call upon to review its suggestions and policies.
This practical expertise of the sector is the only way to ensure such an agency will actually be of real use to small business owners, rather than another ineffective, expensive Government department. And if it could highlight issues such as the National Insurance holiday from last year’s Budget - which was actually of very limited help to small businesses because not many of them take on employees during their first year of business - and amend them so that small businesses really benefit, then it would be extremely useful indeed.
Combined with the proposals from the EU and OTS, it’s becoming clear that the Government has the opportunity to make a monumental difference to the UK’s small businesses and freelancers. If they’re keen on seeing these businesses spearheading the country’s economic recovery, I sincerely hope they implement as many of these proposed changes as possible.
- Pre-election Finance Bill adds to MTD uncertainty
- How MTD will work for businesses with an accounting year that doesn't match the tax year
- Important news for contractors - changes to IR35
- New tax year: what has changed?
- New VAT flat rate scheme rate for certain businesses