News

March 20, 2013

Mixed reactions to Osborne’s Budget

Business bodies, including the Federation of Small Businesses (FSB), have generally reacted favourably to George Osborne’s 2013 Budget.

John Walker, national chairman of the FSB, said: "The FSB asked for a budget for small businesses and this is what has been delivered. This Budget opens the door for small firms to grow and create jobs. The Chancellor has pulled out all the stops with a wide-ranging package of measures to support small firms.”

Commenting on the specific announcements, Walker said: “The National Insurance contributions (NICs) cut goes beyond what we were asking for and we are pleased to see the 3p fuel duty rise due in September completely scrapped. We now look forward to hearing details on how the Government intends to take forward the Business Bank that will help provide much needed access to capital for small firms."

Simon Walker, director general of the Institute of Directors (IoD), said:     

“We applaud this budget. The Chancellor has stuck to his guns and held his nerve — which is exactly what we wanted to see. Deficit reduction is not an optional policy, it is an absolute necessity, and he is right to reject the siren calls to abandon it. Businesses will be glad that George Osborne has also continued the downward pressure on corporation tax. Britain must become the most competitive place to do business, and lower taxes will attract welcome investment from abroad. The new allowance to reduce the tax on employing people is a welcome boost for businesses who are working hard to grow.”

However, John Longworth, director general of the British Chambers of Commerce (BCC), said businesses would be wishing that Osborne had been “more radical in the pursuit of growth”.

He said: "While there is much for business to welcome in the Chancellor's statement … he and his Cabinet colleagues should have gone further to support enterprise and growth, such as scrapping damaging increases in business rates. We are at an unprecedented moment in economic history, and the government should be doing everything in its power to get the economy moving. Many of the Chancellor’s measures were targeted at larger corporates, and those that will benefit smaller companies will not take effect until 2015, which is too late. We need urgency, scale and delivery today.”

Chas Roy-Chowdhury, head of taxation at the Association of Chartered Certified Accountants (ACCA) called it a “bland budget”. He said: “At a time when the economy is stuttering, it needs a genuine boost. Cutting the basic rate to 15% until 5 April 2014 would have been a brave move by the Chancellor, but would help working families across the UK. Under today’s proposals they, and many others, will not notice any difference. A temporary tax cut seems drastic but these are exceptional circumstances.”