Reform the tax regime to help businesses grow

A significant number of firms believe that the UK’s business tax regime has hindered their efforts to recruit more staff, a new survey has claimed.

The Federation of Small Businesses’ January survey found that more than half of respondents (58 per cent) thought that taxes prevented them from taking on new employees.

Worries that the temporary lift in employment seen over the Christmas period is coming to an end have prompted the FSB to call on the government to freeze national insurance contributions.

The FSB also wants the government to provide a national insurance rebate for small businesses with fewer than 50 staff that take on more employees during the coming year.

John Wright, the FSB’s national chairman, said: “The January employment figures showed a welcome fall in the number of people out of work, but we fear the severity of the recession will begin to be evident when the latest [unemployment] figures are released.

“What the UK economy needs is real action to get more people into work, especially under-25s, who make up a large proportion of those currently unemployed.”

Mr Wright added: “A cut in national insurance contributions would encourage small businesses to take on more staff and grow their business. Small firms can help to strengthen economic recovery if they are given a chance to grow and flourish, but they will need a helping hand.”

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