27/02/2009 - EU cuts red tape for small firms
The European Commission has decided to abolish accounting rules for small business in a bid to help them save money in the midst of the economic crisis.
Under current rules "micro enterprises", which are businesses with fewer than 10 staff and turnover below £880,000 a year, are required to submit audit reports to national authorities, but according to the Commission this latest decision will save £5.6 billion a year in running costs.
The proposal is part of the EU's Economic Recovery Plan unveiled last November and it has been welcomed by the Government. The move now requires formal endorsement from MEPs and EU ministers, however it is not expected to be challenged.
Stephen Carter, Department of Business minister, said: "The Commission's proposal to review the accounting and audit reporting requirements is a very welcome and positive move.
"This is the first major measure coming out of the Commission's programme to cut the administrative costs of EU by 25% by 2012 and could save UK businesses up to £200 million a year."
It is hoped reducing requirements for small businesses will help them to cut costs during the economic downturn "enabling them to take advantage of the upturn when it comes".
Copyright © Press Association 2009
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