Punishing small firms

As readers of this blog will be aware, I have been a constant critic of this Assembly Government’s policy towards business rates, one of the few fiscal instruments which it has the power to reduce to help the private sector.

If it isn’t bad enough that business rates are higher in Wales than the rest of the UK, what has the Assembly Government now decided to do during the worst recession in living memory?

Yes, believe it or not, it has decided to increase business rates by an above-inflation rise of almost five per cent for 2009/10.

It almost beggars belief that at a time when owner managers are looking to save every penny to enable them to survive this economic slump, the powers that be at Cardiff Bay have decided that the best way to support businesses is to take more money out of their pockets.

As if this wasn’t enough, the UK Parliament finally announced plans for a new Business Supplementary Rate Bill last week.

This legislation, which was a direct result of the Lyons Review into local government finances, will allow local authorities in England and Wales to levy a local add-on to the existing business rates.

For many tourism businesses in Wales, it raises the spectre of the ‘bed tax’ which Lyons suggested would be one way for councils to raise money.

As our elected representatives in Westminster and Cardiff Bay are always so eager to tell us, small businesses are the backbone of the economy. Yet at a time they need real support, our entrepreneurs are not only being burdened with higher rates but councils are being given the power to squeeze them even more.

You couldn’t make it up, even in these crazy times.

Such insensitive actions demonstrate, yet again, how out of touch politicians have become from the harsh realities faced by many hard working businesspeople across this nation.

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