CHANCELLOR of the Exchequer Alistair Darling will meet leaders of the UK’s four biggest business organisations today to discuss their concerns over planned changes to capital gains tax.
Business leaders have been joined by unions and the opposition in raising concerns over the decision to abolish taper relief on the tax, announced in Mr Darling’s Pre-Budget Report.
Last week the North East Chamber of Commerce said thousands of entrepreneurs and small firms in the region faced an 80% tax hike thanks to the Chancellor’s efforts to close a loophole on private equity.
And it added the move would cause “serious harm” to small business growth in the region.
Business leaders also argue the change will hit small businesses and entrepreneurs rather than the private equity firms it was designed to target.
Today’s meeting comes in response to an open letter to the Chancellor from the CBI, British Chambers of Commerce, Institute of Directors and Federation of Small Businesses warning that abolition of the relief will “undermine enterprise” in the UK.
At the Chancellor’s invitation, Richard Lambert, director general of the CBI, David Frost, director general of the BCC, Miles Templeman, director general of the IOD, and John Wright, the Teesside-based national chairman of the FSB, will visit the Treasury.
A spokesman for the FSB said they hoped to persuade Mr Darling to rethink his plan to impose an 18% flat rate for Capital Gains Tax on profits from sales of assets, in place of the current sliding scale which can see entrepreneurs pay as little as 10%.