UK's Small Firms To Air Grievances Over Tax System

by Jason Gorringe, Tax-News.com, London

25 May 2004

It has emerged that a cross-party group of MPs is to ask the UK’s small firms whether they think they are being treated fairly by the tax system in a survey that could lead to new taxation proposals by the government later in the year.

The survey comes in the wake of recent attempts by the Treasury and Inland Revenue to ensure that the self-employed and small firms pay the “right amount of tax” through measures such as IR35, the treatment of ‘husband and wife’ partnerships and the recent levying of a 19% dividend tax.

Respondents are to be asked how these recent changes have affected their business, and whether the self-employed would benefit from a different legal structure.

Kerry Pollard MP, Chair of the All Party Parliamentary Small Business Group which compiled the survey, was quoted by the Daily Telegraph as explaining that:

"We want to know whether the smallest of businesses suffer from a disproportionate tax burden, whether the legal status of a small business affects their tax burden, and whether there is an appetite for a separate legal structure for the self-employed."

The findings of the consultation will be debated in Parliament, and it is hoped that any conclusions drawn from it will influence a Treasury review of small business taxation to be launched with the pre-budget report in the autumn.

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