Autumn Statement – not all bad news for contractors and SMEs
Limited company contractors and freelancers didn’t do too badly with regards to the Autumn Statement; particularly with the announcement that the government is to scrap the previously planned 3p rise in fuel duty.
This will have a positive impact on the self-employed, due to the miles that many contractors clock up from traveling and meeting with clients.
The Forum of Private Business, which is a hands-on business support organisation focused on the growth of small businesses, have said that although this gesture will provide temporary relief to those who rely on vehicles, the government should look to introduce a fuel-duty stabiliser, which would help with lowering the price with rising oil costs.
The Forum’s Chief Executive, Phil Orford, said, “A 3p rise in January would have been nothing short of economic vandalism in the current climate. In fact it would have been hard to imagine a worse start to 2013 for the UK economy.
He added, “Fuel prices have reached a cliff edge, and the chancellor has acknowledged this with today’s announcement. He has also clearly heeded the overwhelming objections from small businesses that high fuel prices are hampering their own growth ambitions on a number of levels.
We had urged the Treasury to commit to the concept of a fuel duty stabiliser by the end of the current Parliament, so what we have here is temporary relief instead of a serious policy change with real lasting benefits, but we can’t see many businesses bemoaning that just yet.”
Limited company contractors will also be pleased to hear of the extension of the Small Business Rate Relief, and a 10-fold increase to Annual Investment Allowance up to £250,000.
Mr Orford explained, “The increase in the Annual Investment Allowance to £250,000 is welcome but a tacit admission that the decision to cut the same allowance to £25,000 this year was a wrong one.
Given that UK businesses are currently sitting on £700bn of cash reserves, it could be argued that the earlier actions of the Chancellor created a disincentive to invest through 2012, at a time when business needs confidence to create growth.
Nevertheless, we welcome this increase and urge businesses to take advantage of it. There are big savings to be had here for firms who’ve been waiting for the right time to invest and upgrade equipment, and this kind of spending tends to wash right down the supply chain.
Click here to download your full free PDF of the 2012 Autumn statement.