Member Article

Budget 2014: Chokehold on SMEs and high earners is counter-productive, warns tech entrepreneur

With the budget looming this Wednesday, talk is turning to business wish lists and taxation fears. A number of business leaders have already spoken out about what they’d like the Chancellor to announce. Looking at their concerns, there is a sense that, despite acknowledgement from politicians on the importance of fostering entrepreneurialism and SME growth, business success is still being stifled.

One entrepreneur who has warned of the unfair pressures on smaller businesses is Lawrence Jones, CEO of cloud hosting and colocation firm UKFast. “Ultimately, if Britain wants to keep entrepreneurial talent it needs to re-evaluate who it targets with taxes,” he explained. “At the moment, it feels like SMEs are propping things up and having to take the brunt of it, while the bigger corporations find ways to avoid it.”

Instead, Jones suggests a flat rate of tax for companies turning over money in the UK. “Yes, it would be less to pay,” he concedes, “but then everyone would actually pay it rather than fleeing the country to avoid it. What politicians are doing at the moment is actually encouraging individuals and businesses to go abroad and discouraging them from reinvesting back into Britain.

“Things need to change and they need to change radically if we are to see improvement in the country. I’d love to see focus on improving our education and health systems and an encouragement of entrepreneurs and budding businesspeople; the innovators and the creators of jobs!”

Jones has also backed the recent comments of businesswoman Jacqueline Gold who has called for measures to combat the rising cost of childcare. Last year, Jones created a crèche in his company’s HQ to help new parents back into work. “With over 200 employees we reached the stage where a child-friendly facility like this was high on the agenda for many members of the team. Not all businesses can do this though. What Ms Gold has said about childcare costs being deductible from personal tax bills is an interesting suggestion and one that I think the Chancellor should consider.

“Whatever happens, I think we need to shake things up. As it stands, it seems like politicians are doing the same thing over and over again, but still expecting different results. Didn’t Einstein give this as the definition of insanity?”

This was posted in Bdaily's Members' News section by Emma McClelland .