North East entrepreneurs have criticised the Spring Budget for its lack of support for the scale-up ambitions of businesses.
In a snap poll by the Entrepreneurs’ Forum, 83 per cent of responding members believe the budget would fail to support scale-up ambitions of businesses.
Explaining why Chancellor Philip Hammond’s first, and last, Spring Budget, did not meet their scale-up ambitions, entrepreneurs cite the National Insurance increase for the self-employed as a clumsy way to try and close a tax loop hole that will ultimately penalise small self-employed business owners.
Another response says, ‘The changes to NI contributions for the self-employed seem a backward step if you want to encourage business start-up. The suspicion which is being pointed towards people who earn their living by investing, mentoring and supporting high-growth businesses as some kind of tax avoidance will not be helpful.’
Entrepreneurs questioned also would have preferred to see a further cut in Corporation Tax or Employer National Insurance contributions, which would help to make it easier for smaller businesses to fund growth.
Gillian Marshall, chief executive of the Entrepreneurs’ Forum, adds, ‘Our members are disappointed by the outcome of the Budget, which can act as a disincentive to start and grow a business.
‘Scale-up businesses have the potential to provide a solid backbone for the UK economy and therefore require support from government to achieve their ambitions.
‘With Entrepreneurs Relief and low interest rates the environment is pretty solid for those with ambitions to scale-up, and the government has acknowledged the importance of scale-ups with Small Business Minister Margot James becoming a champion for growing businesses.
‘However, unfortunately that has not transferred into the Budget, which, instead, made entrepreneurs a tax target rather than a growth generator.’