BCC frequently expresses its strong concerns over the effects that the current increase in public spending (estimated to rise by 4.5 per cent for the next three years) may have on businesses, highlighting the need for no further increase in the tax burden faced by businesses. This message is especially important, given that most economists view the Treasury's projections of economic growth as overly optimistic, increasing the likelihood that taxes will have to rise sometime in the next few years to make up for the gap in revenue growth.

However, as well as the overall level of taxation, the distribution of the tax burden and the targeting of fiscal incentives in key sectors are equally important issues affecting businesses, as are regulatory obligations they face.

Our 2007 Budget submission focuses on reducing the burdens on business and creating the infrastructure needed to raise productivity throughout our economy enabling us to compete on a global scale. To achieve such an aspiration we must ensure we have the right support for businesses – we must see the raising of skill levels; the reduction of business taxation; a supportive regulatory environment and an improvement in the transport system.

The BCC urges the Government to acknowledge the challenges faced by small and medium-sized business. For far too long the Government has considered the business community as a whole and has not given any specific consideration of the operational impact of policy on the SME sector – a sector which accounts for 99.9% of all private enterprise. In many instances the policy burden falls disproportionately on the SME sector with little or no extra support from the Government. SMEs find it particularly difficult to interface with government as it often is not geared up to deal with the specific challenges facing small business. We therefore urge the Chancellor to think small first when it comes to the business agenda.

Some of the key recommendations of our budget submission are:

• Tax simplification - particularly alignment of the rules governing NI and PAYE;
• Limiting the overall regulatory burden - we would also like to see a clearer focus on the quantified benefits outweighing the quantified costs in the RIA process and for this to be the deciding factor in policy making;
• Improvement to Train to Gain. SMEs acknowledge the role they need to play to train employees, yet to engage with this scheme employers must fill in up to 22 pieces of paper. Whilst firms with HR departments will be able to do this many SMEs simply do not have the resource;
• Reduce the complexity of public procurement contracts - from demanding an upfront fee to compliance with employment legislation, Local Authorities keep placing barriers up that SMEs do not have the resource to deal with thus precluding many SMEs from developing new opportunities;
• We need an integrated, sustainable transport system which delivers real choice across different modes of transport and meets the needs of business;
• The British Chambers of Commerce remains opposed to relocalisation of the business rate under any circumstance.

Click here to download the BCC's Budget Submission 2007 in PDF format>>

For further information, please contact: -

Narinder Gill
Senior Policy Adviser
n.gill@britishchambers.org.uk
Direct Line: 020 7654 5811
Mobile: 07834 258 520