Spring Budget 2017 fails to impress UK SMEs, hints to the need for business insurance

Just like households, businesses were also waiting for the Spring Budget 2017 with a lot of anticipation. As the Chancellor Philip Hammond pledged to convert the UK into the best place for starting and growing business, there was a lot of expectation from the business class. However, it seems that businesses especially the SMEs are not very pleased with the latest budget. Some of the reasons cited by experts are increase in National Insurance and cutting down of the dividend tax free allowance.

When all these reasons were clubbed, it was discovered that there would be an additional tax on entrepreneurs and the self-employed. Moreover, the tax amendments made in the recent budget are not the most suitable bet for the small businesses. As most of the small business owners were looking out for a considerable reduction in the income tax, the budget was a disappointment for them. On the whole, experts suggested that the budget could be termed as a mixed bag for the SMEs. Therefore, insurance experts suggest that every business, be it small or big should choose the best business insurance as it helps to deal with crisis situations of all kinds.

ICAS agreed that the budget was average for the SMEs however, concurred with the Chancellor’s decision to put off the Making Tax Digital (MTD) scheme for the businesses that manage a turnover that is falls below the VAT threshold. Anton Colella, chief executive of ICAS expressed his views by saying that "ICAS supports the overall objectives of Making Tax Digital, but has long been concerned with the unrealistic timescale for the project. This shows a chancellor who has listened."

Some of them even felt that the Chancellor gave priority to the big businesses instead of encouraging the start ups and smaller organisations. Jenny Tragner, director at R&D tax credit consultancy ForrestBrown pointed out the contradictory statements of the Chancellor and said that "The government’s message also seems to be contradictory. The Spring Budget appears to prioritise the needs of big business over those of SMEs and start-ups, yet the chancellor stated it is the government’s ambition for the UK to be the best place to start and grow a business."

Many of the business owners were waiting for the announcement of the Small Business Commissioner. They argued that as small businesses form 99% of the private sector, there is an ardent need for the appointment of the commissioner. The Chancellor did not make any announcement on this front and so it was quite disappointing for many. Dafydd Llewellyn, managing director of Concur said that "I was disappointed however, not to get a further update on the appointment of the Small Business Commissioner."

To sum up, the budget did not do much for SMEs and people felt quite dejected from it. In such situations, it becomes important that the SME has a small business insurance cover because if any unexpected event or wrong decision may result in huge losses then they can recover from it. To protect one’s business from sudden failure or bad blows from the market, one should choose all-inclusive business insurance.

Brijesh is a personal blogger and passionate financial advisor living in the London. He works at FreePriceCompare.com a price comparison website in the UK.