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Could do better: SME verdict on the Autumn Statement

It was not an easy time for Philip Hammond to announce his first (and last) Autumn Statement. There were some positives for SMEs, but overall, he could have done more for this key-growth sector.

On the plus side, the Chancellor unveiled significant FinTech investment plans and confirmed that the rate of corporation tax will fall to 17%. There is also the planned move to a fully digital tax return system and business rates relief for small companies in rural areas.

However, despite these initiatives, the feeling is that the Statement was a missed opportunity. Amid all the Brexit gloom, small businesses need a boost, a bold move to signal a positive future, but none of Hammond’s actions fitted the bill.

Of course, the cautious approach can be linked firmly to the current Brexit-bred economic uncertainty, but this instability was also a good reason to take definitive action to reassure and reinvigorate SMEs. Much has been said about the need to help the small business sector increase investment in skills and equipment, and the lack of affirmative action on this front.

There is disappointment that more hasn’t been done to reduce business taxes and the cost of doing business. Also, in terms of helping SME cashflow, the Chancellor failed to give non-bank finance any kind of uplift. With traditional lenders remaining cautious, and with current economic conditions suggesting that there will be little change in this position, if small businesses are going to invest in skills and equipment, alternative finance is going to have to play a key role in generating this capital.

Therefore, new action to raise the profile of services such as invoice finance, asset finance, peer-to-peer lending and crowdfunding would have been welcome. Nevertheless, despite this missed opportunity, the alternative finance sector continues to go from strength to strength.

To find out more about A&T Business Associates services, contact us on 01903 602211 or info@atbusinessassociates.co.uk.

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