Smaller firms need more help on regulation
Smaller businesses are continuing to struggle with the burdens imposed by regulation and tax.
A new report from the Institute of Chartered Accountants in England and Wales (ICAEW) said that, while the burden had eased for larger companies, SMEs still believe that the regulatory and tax systems are weighted against them and remain disillusioned with the level of bureaucracy with which they must deal.
Business perceptions of the regulatory and taxation environment have improved since last year, the ICAEW Enterprise Survey concluded, with 52 per cent of respondents saying that the UK is business friendly, up from the 45 per cent in 2009.
However, it is a different picture when the views of SMEs are taken in isolation.
Two thirds (66 per cent) of small firms and 62 per cent of micro businesses do not regard the UK as friendly to enterprise.
Employment tax is seen as the biggest barrier for the majority of businesses (61 per cent), followed by employment legislation (53 per cent), with changes to business rules and tax, and health and safety regulation both registering 49 per cent.
The research revealed that 80 per cent of firms have plans for growth over the next two years, compared with just 66 per cent in the last survey.
But forecasts about the actual level of growth remain relatively subdued, with the average target rate of expansion slipping to 10.1 per cent from 11.2 per cent in 2009.
Robin Fieth, executive director of the ICAEW, said: “The ICAEW Enterprise Survey shows that the regulatory tide is starting to recede for larger companies.
“However, there is a real risk that SMEs could be left to drown. Small businesses are key to driving economic recovery. Government therefore needs urgently to urgently start setting out how it will make the UK a friendlier place to do business.”