Small firms hit by government stealth tax
Flat rate VAT is charged to the smallest businesses with a turnover of less than £150,000 and aims to minimise the red tape around administering VAT.
“When VAT was lowered in December 2008 many rates stayed the same and some were reduced by up to 2.5%. What has become apparent is that after VAT was put back to 17.5% in January this year, nearly half of the flat rate schemes have seen the VAT level rise above the pre-decrease level,” said John Wright, National Chairman of FSB.
“While a few sectors have seen a decrease, the majority of businesses will see their rates rise, which is unacceptable at a time when cash-flow is limited. The FSB believes that this is a stealth tax, which will affect a firm’s overall profitability.”
Business Advice for all UK firms from starting a business to flotation - Banking & Finance, business advice or business startups and starting a business. Article from http://www.newbusiness.co.uk
