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'Ditch tax increase' for small firms

Nov 14 2008

Chancellor Alistair Darling has been urged to halt a planned tax increase for small businesses, which is due to come in on April 1st next year.

A rise will see firms with profits of up to £300,000 paying 22 per cent tax, rather than the current rate of 21 per cent, in a move which will make the government £450 million a year.

However, now Alistair Darling is being urged to scrap the plans, as some fear it may be the difference between some companies surviving and going under.

Stephen Alambritis, chief spokesman for the Federation of Small Businesses (FSB), says the timing of the increase could not be worse.

'We cannot see how the government can say they want to do all they can to support small businesses, but hike taxes at the same time,' he states.

The FSB has previously stated that small businesses are being overlooked by the government and the £4 billion of funding from the European Investment Banks needs to reach the firms rapidly.

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