Ahead of the budget this Wednesday, a survey commissioned by accountancy firm Moore Stephens revealed that the majority of SMEs are in favour of a change to the tax system and introducing a flat rate of tax.
It revealed that around 55% of SMEs are in favour of the change and clients of Moore Stephens said it would help simplify the tax system, which is currently too complicated and time consuming for most businesses.
Partner at Moore Stephens, Simon Baylis, said that it was “No surprise” this was the most popular change, adding “Most of our clients are business owners and they see the impact of red tape and tax issues everyday they try and run their business.”
He continued: “Reducing the complexity of the tax system would provide a boost for businesses as owners and managers would regain time for productive work that is currently spent on tax issues.
“Many small businesses believe that if the tax system had fewer ‘nooks and crannies’ then they could pare back some of the advantages big businesses enjoy.”
Moore Stephens claims that each successive government has introduced more complex taxes and levies on businesses, which SMEs are desperate to see reversed.
Mr Baylis says that entrepreneurs in sectors like property development will suffer due to the changes to Entrepreneurs’ Relief, which could result in less viable projects.
“Also the planned increase to tax rates on dividends will see the income of many SMEs fall substantially.
“Overall I expect that the Budget will contain a larger number of measures intended to raise revenue than it will giveaways.”