Small businesses hit by tax hike

March 23, 2007 1:00 PM

David Howarth, MP for Cambridge, has criticised Government plans to penalise smaller businesses.

In Wednesday's Budget, the Chancellor Gordon Brown announced an increase in corporation tax for small businesses. This will cost small companies an additional £820m per year in tax by 2009.

Mr. Howarth commented:

"Yet again the Chancellor seems to be taking from those who can least afford it. He is putting up taxes on small businesses while cutting them for big business.

"Many small Cambridge firms are going to be hit hard by Gordon Brown's tax hike."

The Chancellor has claimed that the establishment of a new Annual Investment Allowance will offset some of these costs for small businesses but this will not be available to the smallest firms.

Mr. Howarth added:

David Howarth MP

David Howarth MP

"Cambridge start-ups will not have the cash-flow available to access the Annual Investment Allowance, leaving them struggling under the burden of higher corporation tax. Yesterday's budget was a disaster for small firms."

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