The Federation of Small Businesses (FSB) stated that freezing thresholds will ‘hit small businesses’, and that the Chancellor’s growth measures ‘will not be enough to spark the needed economic recovery’.
Martin McTague, National Chair of the FSB, said: ‘While tackling inflation is essential, so are measures to create conditions for prosperity, growth and support enterprise.
‘Small businesses, which account for more than 16 million jobs in the UK, were already facing an acute cost of doing business crisis through soaring costs, falling revenues, shrinking availability of affordable finance and a rise in invoices being paid late. On top of all that, they now face even higher taxes, cuts to innovation, and a recipe for a longer and deeper recession.’
Meanwhile, the British Chambers of Commerce (BCC) said that the Statement is ‘unlikely to boost business confidence’. Shevaun Haviland, Director General of the BCC, said: ‘The Chancellor has stayed true to his word in focusing on financial stability and targeting support for the most vulnerable in society. But in the teeth of a recession, this statement will not increase business confidence.
‘Businesses will look at [the] announcements and welcome support with business rates and the retention of the employment allowance, though the reduction in the dividend allowance will impact many smaller firms.’
The Institute for Fiscal Studies (IFS) said that ‘most of the difficult decisions on spending have been deferred for a couple of years’. Paul Johnson, Director General of the IFS, commented: ‘On taxes, we’ve got some reasonably significant tax rises, certainly on energy companies, on employers and on people with high incomes and income from wealth.
‘The next two years look grim in terms of living standards – the biggest reduction in household incomes, possibly on record, certainly within recent generations.’