The Confederation of British Industry (CBI) have hit out at proposals from a leading Conservative MP, claiming that they would lead to higher taxes for small businesses.
The CBI criticised an article penned by Tory MP David Curry in yesterday’s Financial Times which suggested that business rates should be decided on a local, rather than national level.
However, the CBI said that the proposals would see business rates rise dramatically in order to curb council tax increases.
Many small firms have already voiced their displeasure at the current rates system, with the Forum of Private Business (FPB) claiming strong support for its campaign to raise the threshold for rate relief.
The CBI said that setting rates at a local level would herald a return to the 1980s, when small firms had to suffer sky-high business rates.
Digby Jones, director-general of the CBI, said that business people across the country will be “horrified” to see Curry arguing for a return to the bad old days when business rates were set at a local rather than national level.
“We urge Conservative leader Michael Howard to make clear that he will stand up for business and reject any policies that would trigger further damaging increases in business taxation.
“David Curry assets without any evidence that things would be different this time. He seems to be wearing rather rose-tinted spectacles.
“Companies simply do not believe localisation would work any better today than 20 years ago. Most people, including I suspect Mr Howard, will find it extraordinary to see politicians talking about firms having ‘an easy ride’ and not paying their ‘fair share’.
“Where on earth have these people been? Britain’s tax competitiveness, a cornerstone of our economic success, has been badly damaged in recent years as firms have borne the brunt of national-level tax increases,” he said.
