20/11/2009 - Firms 'strangled by tax red tape'
The red tape involved in dealing with taxes, particularly VAT, is threatening to strangle small and medium sized enterprises (SMEs), according to the the Federation of Small Businesses.
It was commenting on a report by the World Bank and PricewaterhouseCoopers that the hours a year spent filling in tax returns is now at a record 110, up from 105 in September,
That puts Britain at 25th in the rankings of 183 countries for the least number of hours spent on taxes.
In January, businesses will have even more to do when the temporary cut in VAT ends and they must once again change their accounting and cash-flow systems.
Small business groups are now warning that cutting red tape must be done as "a matter of urgency" if the country is to make a speedy recovery from recession.
Says FSM spokesman Stephen Alambritis: "It is crucial that these figures are taken seriously. If the economy is to recover from the recession, it will rely on small businesses.
"VAT is one of the main administrative burdens for small businesses, and chopping and changing it merely adds to this."
Copyright © Press Association 2009
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