“Private sector bad, public sector good” To anyone on the old socialist Left it was a mantra ingrained from birth. And every bit as wrong as its converse, the mantra of the equally unthinking Right.
Nowhere is this truer than in the world of Small and Medium Enterprises (SMEs). These private companies are the lifeblood of successful economies. They provide the energy, dynamism, most of the new ideas, and much of the employment that not only makes life enjoyable, but sustainable. And here’s a killer fact for the Chancellor: they’re much easier to tax, because they’re firmly stuck and visible in their country of origin. While the big boys can move stuff around from subsidiary to tax haven, and don’t have to pay for all the roads, schools hospitals and policemen that make their operations possible.
Now so many small businesses lie shut by the Covid-19 lockdown, uncertain of their future, shorn of their markets, while the giant chains trade away as if nothing had really happened.
UK Chancellor Rishi Sunak has a budget to deliver in March. He knows he must start lifting the UK economy out of the Covid doldrums. We qualm at advising such an intelligent man. But here are four actions which might help the SME sector.
Use the tax system to facilitate supply chains, such as logistics,skills and informational support
Tax breaks for exporters, and businesses that support them
A treasury run task force of advisers to help with all aspects of bureaucracy and form filling
A Planning Agency to identify and exploit future export markets, comprising businessmen,economists and the Government, as in South Korea
SME people don’t want much. They prefer to stand on their own two feet. Larger export markets, for economies of scale. Sympathetic banking structures, like the German Mittelstand system. Above all a level playing field. We know personally of five such who started small and grew into major export success stories in fields as diverse as Biotechnology, Financial services, Picture framing, Games, and Forensic Science technology. They were the bravest, most risk taking, hardworking people we have met. Time to recognise these qualities?
#exports #smes #marchbudget #rishisunak #covid-19 #lockdown