Small businesses in the UK have expressed their happiness upon learning of the Inland Revenue’s decision to keep its word by pledging to assess the UK tax regime’s administrative burden.
The HM Revenue and Customs made this known through a small business consultation document that was released alongside the Budget for this year. The section, entitled “Small Business Impacts,” stated that Revenue and Customs have vowed to begin a consultation that will aim to change the relationship between small businesses and the new department. The document stated that small businesses generally bear a lopsided share of the administrative burden.
This development is considered good news for small businesses, start-up businesses as well as freelance professionals since the eventual goal is to reduce these costs for these sectors. It is eventually hoped that more entrepreneurs will be encouraged to form their own start-up companies .
The HMRC has already appointed the accountancy firm KPMG to research into the “Cost to Business of Meeting the Administrative Burden of Information Obligations.” The report is due to be submitted on March 2006. Entrepreneurs and small business groups are being encouraged to participate in the research so that they can voice their opinions and give their own inputs.
Barclays Bank, in a recent study, has suggested that the current probe into the tax burden has been long overdue. Meanwhile, sixty percent of entrepreneurs have said that they would ask Chancellor Gordon Brown to reduce the number of regulatory forms that are required in running a company. The study also revealed that tax incentives are ranked as the second most important incentive that Brown should be able to give to them. This view is supported by and business solutions experts. They opine that it will entice more entrepreneurs to expand their businesses and form new start-ups along the way.