Following intense pressure and criticism, the chancellor has agreed to meet with business lobby groups to discuss the planned changes to Capital Gains Tax (CGT).
Alistair Darling will today meet with representatives from the British Chambers of Commerce (BCC), the Confederation of British Industry (CBI), the Institute of Directors (IoD) and the Federation of Small Businesses (FSB).
The four business groups sent a joint letter to the chancellor last week in which they said they were ‘deeply concerned’ with the changes to CGT which included the scrapping of Taper Relief.
A flat rate of 18% is set to be introduced from April 2008, which replaces the old CGT system where taxation ranged from 10-40% depending on the type of business asset held and how long it had been owned.
The joint letter sent to the chancellor stated: ‘Owners of small enterprises, who have toiled over years to build up an asset, are now faced with selling up before April or facing a substantial dent to their investment.’
However, unions have urged Darling to resist business calls for a reversal of his decision to change CGT rules. TUC general secretary Brendan Barber said:
“The chancellor was right to change the CGT regime and he should resist calls to do a U-turn. He should not only stick to his 18% CGT guns, but should go further to crack down on speculators and tax avoidance schemes.”
© Crimson Business Ltd. 2007
