On the eve of the Spring Statement, more than nine in ten small businesses can think of positive things they would like to see announced that would give them greater business confidence for the months ahead. According to new research from Novuna Business Finance, conducted over the last 72 hours, the top five factors included:
- Lowering taxes for small businesses comparing to large companies (25%)
- A commitment to keep interest rates and inflation stable and at current levels (22%)
- A commitment to reducing red tape, simplifying the regulatory system (22%)
- Reverse the increase in employer NI contributions, due to start this April (21%)
- Reducing the tax burden on consumers to encourage consumer spending (20%)
Set against what small businesses hope for, the things they would be worried about included:
- A worsening growth outlook for the UK economy (37%)
- Personal tax going up and hitting consumer confidence (29%)
- Business taxes (direct and indirect) going up (28%)
- Further hikes to national insurance (25%)
- Changes to the VAT system (24%)
Further, small businesses said that if they were to feel negatively impacted by the Spring statement, the most likely consequences over the coming months would be to:
- Put off plans to create jobs / hire people (30%)
- Look to reduce the size of the workforce to control costs (29%)
- Delay making key capital investments in the business (29%)
The new poll this week of 282 small business owners and decision makers follows Novuna's ongoing Business Barometer study, which has tracked in detail the growth outlook of more than 1,000 small businesses over the last 10 years. The latest figures for Q1 revealed that seven in 10 small businesses (71%) have been working on new initiatives to achieve future growth, despite the percentage predicting growth for Q1 (33%) dipping to a nine-month low (33%).
Thinking more generally about economic developments over the next 2-3 months, small businesses said that rising inflation (37%), business tax rises (29%), the living wage increasing (25%) and rising business running costs (25%) were the things that would be most likely to harm their businesses and their plans to achieve growth.
Joanna Morris, Head of Insight at Novuna Business Finance commented: "We have tracked small business growth outlook in detail for the last 44 consecutive quarters. The picture for this quarter was one of bullish determination by many to adapt and work to secure future growth, whilst grappling with unprecedented market uncertainty and bigger financial burdens. Our latest snap survey aimed to capture a sense of small business sentiment this week. What's positive is many enterprises know what would help them grow but, set against this, there are concerns about the prospect of rising inflation, further taxes and a worsening economic outlook generally."