GFSB Calls For Tax Reforms In Election 'Manifesto'
by Robert Lee, Tax-News.com, London
06 November 2003

The Gibraltar Federation of Small Businesses has published its manifesto of recommended government policies for the next election which calls for simplification of legal rules, tax reforms and easier access to loans for SMEs from the banking system.

“It is necessary to alleviate the burden placed on SMEs in comprehending and complying with the masses of new and existing legislation and regulations,” the GFSB said in its manifesto, reported in the Gibraltar Chronicle. “Legislation should be drafted for the layman to understand and be in a workable, user-friendly manner that has been the subject of meaningful consultation within the industries prior to becoming effective”, it adds.

On tax the GFSB calls for a levelling of the playing field between sole traders and partnerships and corporate entities since the introduction of lower tax rates. “This anomaly needs to be faced if we are to encourage start ups for new businesses where it is necessary to keep costs to a minimum and incorporation is not considered the best solution,” says the GFSB “Businesses remain as the ‘unpaid tax collectors’ for Government and this administrative burden needs to be simplified considerably.”

It continues: “Social insurance contributions were changed from stamps-on-cards to quarterly cheque payments. The aim should have been to simplify the system for the benefit of the employer as well as to ensure regular cash flow for Government. A significant review of the system is needed urgently to ensure that businesses can be relieved from the unnecessary and time consuming form filling, which once again, is not conducive to building up a business.”

The small business groups also criticises domestic banks for their reluctance to lend to young firms.

“There is a requirement that all facilities should be supported by a guarantor or backed by cash. If these were available there would be no need for an application to the bank,” says the manifesto.

“The GFSB have suggested, over many years, that a fund should be available for ‘Business Loans Guarantee Scheme’. The concept would be that the banks would monitor loans to businesses in the normal way, thus causing no extra burden, but that the Government would maintain a deposit as security for the loans.”

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