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Many experts have come out in force against the proposed budget changes, citing an adverse effect on SMBs and the economy at large if Labour proceed with their current plans.

The British Chamber of Commerce have requested that the government get rid of next year’s planned NICs increase and instead raise revenues by increasing VAT to 18.5 per cent. A 1 per cent rise in VAT would generate roughly the same amount of revenues as the National Insurance increase and be a less damaging tax burden for businesses, which are still striving to recover from the recession. The possible increase of 1p in NI could adversely affect SMB growth and hiring policies as the cost of employing new people will go up. This could have a detrimental affect on the economy as a whole in the longer term.

The ACCA have said that they are not in favour of an NICs increase and 56% favour cuts in public spending over NI increases. Labour are set on an increase in NI, so, if people listen to their accountants, then this could count heavily against Labour in the election.

There has been a long term neglect and decline in British manufacturing for years and imports are far exceeding exports. 90% of all global exports rely on some form of trade finance. This eases the movement of international trade by moderating its risks. We need to resolve the current problems SMB's face with securing export trade finance if the UK is to have any chance of an export-led recovery.

However, exports are just one aspect of the British economy and we need a strong economic policy right across the board not just in this one area, if the economy is to start to recover.
Reply by Laura Hillman on 16/03/2010 at 13:14

I think that the only changes they will make will be ones that are voter neutral. But done forget that VAT is a business tax, not a consumer tax. If you have two businesses side by side in the high street selling the same product or service, one registered for VAT the other not. Would the VAT registered business be able to charge 17.5% more?
Reply by taxchampion on 16/03/2010 at 18:10

I think the budget will be politically significant but it would be much better done after the election than before. Sadly politics will always come above the needs of a nation. maybe thats a bigger picture thing, but either way the nation is suffering in the current vacumn.
Reply by Julian Lewis on 17/03/2010 at 10:55

This is will be the last budget before the general election, & also a significant one as UK is still in recession. UK Plc has a huge overdraft to pay off so what can we expect? More taxes, more stealth taxes, less pounds in your take home pay

I forsee the government will make up lost tax revenues from unemployed by bashing high earners. Without going on a political rant, we need a budget that will encourage Entrepreneurialism and give people the incentive to create jobs. Taxing Business people achieves the opposite and encourages more high earners to exploit loop holes & tax planning solutions. In other words the more taxes a business is charged, the less the government actually sees in it's coffers. Added to that the super rich, exile to tax havens, taking more much needed tax pounds "off shore"

The other thing is the government also needs to win votes, so will aim to please the "mass affulent" I forsee. More bad news for Businesses I feel. With so many people out of work, I can only see it going one way.... tax Business people.

Reply by Darren Leighfield on 17/03/2010 at 11:32

There is a definite air of trepidation here regarding the impact the budget will have on business. I have to say I think it's justified. I've been speaking to other sites about the budget, from the individual taxpayer angle, and there is genuine disquiet building all over.

The budget is so close to the general election that it cannot help being part of the campaigning. And Darling would not be doing his job right if he didn't try to gain at least some political capital from it. (That's not to say I think he's right, just that it's the nature of politics.) He will try to appease the majority in a last gasp attempt to swing votes.

Unfortunately, it's pretty clear there have to be some tax rises. The chances are they won't be levied on the public - election suicide - and he probably won't go after big business. Which leaves the middle ground. He may raise taxes for the

What should happen won't happen. We need a fair and reasoned structure that raises enough to help repair the damage, targeting the main culprits, allowing for a sensible period of growth and confidence in business, without hurting those on lower incomes to but at the same time not unduly penalising anyone who has worked hard to get a higher income.

What we will get is series of fairly arcane measures designed to paper over the fact that they are tax rises (1% on NI is the main culprit, although an increase in VAT would not be brilliant), which will quite possibly damage the fragile shoots of recovery by aiming at businesses who will then not be able to pass on the benefits of their success to the wider economy.
Reply by Julian Shaw on 17/03/2010 at 12:15

Thanks for all your comments, the issues you raise are really interesting and given the turbulent times we have experienced over the past 18 months, next week’s budget looks set to be an exciting day that I’m sure we will all be tuning into.

Reply by Cat Lenheim on 18/03/2010 at 09:43

The March budget is important but it will hit the hardworking small business the most. Its almost predictable now as its the same year on year.

Its funny how they want to increase the Tax on fuel yet again. Manufacturing in the UK is ever dying so we import everything virtually. How does the government think we are going to afford to import anything. I can see more small businesses struggling as suppliers will be forced to raise prices.

The budget won't affect the election, I think they know we are ready for a change.
Reply by Kerry Swinton on 20/03/2010 at 15:15

There was a lot of focus on small businesses and entrepreneurs in the 2010 Budget.

What do you think of the 2010 Budget? Will the programmes, changes and schemes outlined by Darling meet your needs?
Reply by on 24/03/2010 at 13:57