SME Business News

Small business owners are perplexed by the governments VAT reduction introduced by Alistair Darling in yesterdays so called ‘emergency mini budget’.

The chancellors call to stimulate spending by cutting the VAT rate to 15% until the end of the 2009 is almost laughable, in fact it would be funny if it did not entail so much more work for hard pressed entrepreneurs.

Response from small business owners has been close to 100% negative, with small retailers facing the task of re-pricing shelves full of items while attempting to serve customers.

Maybe I am missing something here, but saving 2.5 per cent on VAT seems hardly likely to boost a flagging economy into a spending boom. Likewise the governments insistence on forcing banks to lend money to SMEs rather than forcing through much needed legislation on payment terms, shows that they have neither an understanding or desire to help small business, but want to be seen to be doing something.

Despite Gordon Browns call for the world leaders to follow his example by introducing tax cuts to stimulate growth, I really have the impression that the ex chancellor really has no idea where he is taken our country.

If as some suggest the tax cuts are designed to win an early election, the talk is of May 2009, he had better hope that these cuts will really work- and fast.