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Forum Brief: Taxation
The government is facing calls from the CBI to end the "relentless and damaging" rise in taxation and regulation which it says costs companies £15 billion a year.
In its submission prior to Gordon Brown's pre-budget report next month, the CBI argues that the tax burden has eroded their competitive advantage over international rivals.
Forum Response: Institute of Directors
Ruth Lea, Head of the IoD Policy Unit, said: "The single biggest prize that the chancellor could announce in his PBR would be a period of stability in the tax system allowing businesses to focus on creating wealth rather than administering ever more complex taxes.
"For too long the burden of administering taxes on behalf of the government has been shouldered by the business community. Now is the time to take stock, step back and stabilise the current system."
Forum Response: Construction Products Association
A Spokeswoman for the CPA, told ePolitix.com: "The Construction Products Association fully supports Digby Jones' call for the chancellor to end the "relentless and damaging" rise in taxation and regulation.
"In the Construction Products Association's submission sent to the chancellor last month, CPA President, Roy Harrison, told Gordon Brown that he must work with industry.
"Commenting on the increase in National Insurance Contributions announced in the last Budget, Mr Harrison said that the totally unexpected and unwelcome announcement of the increase in NICs was not something on which government had at any time sought the views of industry, and yet it was by far the most damaging measure announced in the last Budget.
"He also stated it is imperative that in his pre budget report the chancellor makes clear that the government will not introduce any new taxes on business, or increase the level of existing ones."
Federation of Small Businesses
John Walker, policy chairman for FSB, told ePolitix.com:"The government over the past five years has given major tax and other advantages to the self employed and small firms, if they incorporate as companies. The biggest incentive so far came in chancellor Gordon Brown's budget in April 2002, when he introduced a zero tax rate for the first £10,000 of a company's profits. While welcoming the tax reductions for the incorporated sector, the FSB believes the government is discriminating against the self employed, partnerships and small firms who want to remain unincorporated and calls for the chancellor to announce measures targeted at unincorporated businesses.
"The Treasury estimates that it raised £1.9bn from Insurance Premiums Tax in the last financial year with the same figure predicted for 2002/2003. With insurance premiums rocketing and many small businesses finding it impossibleto secure Employers' Liability Insurance the FSB believes that a proportion of IPT should be used to finance a "pool" of employers' liability insurance backed by the government."
Forum Response: The Association of Chartered Certified Accountants
Chas Roy-Chowdhury, head of taxation for ACCA, said: "ACCA is concerned that stealth taxes will impose disproportionately unfair burdens on smaller businesses.
"An example of this is where the inland revenue is under pressure from the government to reclassify as many individuals as possible from self-employed to employee status.
"If an employee is masquerading as self-employed, the inland revenue has a legitimate interest in challenging the arrangements. But this drive seems to be aimed at maximising the amount of national insurance contributions, regardless of the economic reality of people's business activities.
"Thousands of businesses and individuals will be affected, as many of the self-employed do not have the time or resources to argue their case. This will have serious implications, not only for the individuals themselves, but for their so-called "employers", who will be subject to more expense and further administrative burden."
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