Capital allowance rise 'does not help SMBs'
May 06 2009
Small and medium-sized businesses (SMBs) are unlikely to benefit from the increase in capital allowances, according to the Forum of Private Business (FPB).
The organisation has joined forces with the Finance and Leasing Association (FLA) to point out that the investment-boosting measure, which was announced in last month's Budget, will have little positive impact on smaller firms.
Estimates from the FLA claim that as few as 15,000 companies will benefit from the enhanced capital allowances, with most of these being larger enterprises.
Matt Goodman, policy representative of the FPB, comments: 'As with the other measures marketed as "business friendly" in the Budget, doubling capital allowances to 40 per cent will benefit relatively few of the small businesses that are in genuine need of support.'
In addition, Stephen Sklaroff, FLA director general, points out that his organisation's members supplied 750,000 SMBs with business equipment worth £15 billion last year and says the government needs to move quickly to increase its support to small firms.
The new criticism of the 2009 Budget joins comments in a recent poll by the Federation of Small Businesses, where almost 80 per cent of respondents claimed the 2p rise in fuel duty would have a negative impact on them and nearly 70 per cent said the Budget does not support small enterprises.
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