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Tax regime hampers job creation - claim
THE UK tax regime is proving a buffer to local business recovery and preventing firms from taking on more staff.
THE UK tax regime is proving a buffer to local business recovery and preventing firms from taking on more staff. That was the view of the Federation of Small Businesses, via its FSB-ICM January survey panel, and ahead of national statistics which showed a rise in unemployment figures and fears of a double-dip recession.
Colin Parnell, Peterborough branch chairman of the FSB, talked of fearing "the severity of the recession" when considering the jobless numbers.
He said: "What the UK economy needs is real action to get more people into work, especially under-25s, who make up a large proportion of those currently unemployed."
Britain's youth unemployment rate is now at a record 19.8 per cent, according to the Office for National Statistics.
Mr Parnell said: "A cut in National Insurance contributions would encourage small businesses to take on more staff and grow their business. Small firms can help to strengthen economic recovery if they are given a chance to grow and flourish, but they will need a helping hand."
The FSB survey showed that businesses in the South East feel particularly strongly, with 64 per cent saying taxes have a negative impact, closely followed by the North West at 60 per cent and London at 59 per cent.
The FSB is stepping up its call to Government to freeze National Insurance contributions and provide a National Insurance rebate for small businesses with fewer than 50 staff that take on more employees during 2010-11.
In late 2009, the FSB-ICM Voice of Small Business Annual Survey showed that 19 per cent of small businesses would take on new staff over the next 12 months in order to achieve business objectives, with London (27 per cent) the most likely to do so.
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