UK businesses believe that the tax system is unfair and want more support to stay compliant and keep up with ever-changing legislation, according to new research by the British Chambers of Commerce.
The BCC survey of over 1,000 firms found that nearly three-fifths (58%) of respondents think that the tax regime is unfair to businesses like theirs and raised concerns over how HMRC applies the tax rules to different types of firms.
Two-thirds (67%) of respondents don’t believe that HMRC applies tax rules fairly across all sizes of business. Micro firms are more likely to hold that opinion (70%) compared to their medium and large counterparts (59%).
One in two (49%) firms don’t feel HMRC provides the support they need to be compliant and this figure is higher for micro firms (51%), compared to medium and larger firms (42%). Many respondents expressed frustration that HMRC underestimated the time and money small businesses spend trying to keep pace with regulation and the complexities of the system.
The rise in upfront business taxes and costs, from business rates to the introduction of Making Tax Digital, and changes to auto enrolment and payslips has added to the burden on firms and is reinforcing concerns over the current tax regime. The BCC also called on the government to pledge to introduce no new input taxes and other significant costs on businesses for the remainder of this parliament.
Haines Watts managing partner Tim Pearce said: “The results of this survey aren’t a surprise to members of our accounts and tax teams.
“In the recent past we’ve seen many well-publicised cases where large, multi-national companies, have “got away” with paying lower rates of tax or even no tax at all.
“This perceived unfairness in the tax system hits small businesses hard and I would suggest is in part created by a rigid lack of communication and support from HMRC along with an increase in red tape.
“SME business are the lifeblood of the UK economy and need to be supported and nurtured, not strangled.”
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