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Autumn Budget 2017: How it will affect small businesses

The first ever Autumn Budget was revealed by the Chancellor Philip Hammond at the houses of Parliament yesterday. The Budget focused on the finances of the country, and how it will affect the citizens of the country, from small business owners to millennials. The budget has mostly had a positive response, especially from the small business community.

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The budget has been positive for small businesses across the country. With Brexit underway, the small business confidence had plummeted and a shroud of uncertainly surrounded the future of SME’s in the UK. This Budget has come as a positive force, encouraging small businesses to grow, succeed and keep on contributing to the economy of the country.

Mike Cherry the chairman of Federation of Small Businesses (FSB) said: “small firms will welcome [yesterday’s] business-friendly Autumn Budget”. It seems that there is money being invested in the future of small businesses, who play a vital role in the UK economy.

It was a big concern that the VAT threshold may be lowered, in an attempt to tax grab from small businesses and the self-employed before the Autumn Budget was announced. However the Chancellor declared that the VAT threshold will remain the same at £85,000, which shows that Hammond has acknowledged the concerns of small business owners.

Mike Cherry commented: “Dragging thousands of more small firms into the hugely complex VAT regime would have caused a significant drag on output at an already challenging time for businesses. We look forward to working with the Government to reform this burdensome tax. Small firms spend more than a working week a year complying with VAT obligations on average. It’s time that should be spent growing their firms”.

Another issue that small business owners face is the lack of funding available to them, which is vital for businesses who are just starting out or even those who are growing their organisation. Lack of funding plays a huge role in the hindrance of small business growth, and consequently the growth of the UK economy.

The budget also addressed this lack of funding, to which Mike Cherry reacted: “[Yesterday’s] announcement of an additional £2.5 billion for the British Business Bank to continue their vital work in facilitating access to finance for small firms will help make that happen. Freeing up pension funds to put more money behind innovative small firms will also add to our international competitiveness”.

The other announcement that will effect small businesses is the investment of £30 million in the upskilling of the workforce. The money will be invested in the learning of digital skills and long distance learning. This is a good investment for the future of the workforce, ensuring that the younger generations are prepared and have relevant skill sets for today’s job opportunities.

Overall a positive Autumn Budget with regards to small businesses. With £3 billion being dedicated to dealing with Brexit over the next two years, it is also hopeful that a smooth Brexit will occur. This will give small businesses a chance to look ahead and plan for the future.

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