MP backs more tax relief for small firms

EAST Devon's MP has backed the streamlining of a Government tax-relief scheme to help the district's thousands of struggling firms - by slashing red tape.

This week the Conservative shadow-cabinet said they would cut taxes and paperwork for the Small Business Rate Relief - if they won the next election.

Small Business Rate Relief was introduced in 2005, allowing small firms to claim up to 50 per cent off their business rate bills.

In East Devon last year 1,997 firms clawed back �1,171,863, up from �1,113,331 in 2007 and �1,000,996 the in 2006.

But the Conservatives want to give tax relief automatically to all firms - they complain that currently firms have to fill out paperwork to claim even though tax inspectors already know which firms are eligible.

Mr Swire was speaking following a Parliamentary debate - the Tories are trying to push through a private members bill, a proposal for new legislation by a single MP, to overhaul the scheme.

He said: "Small shops and businesses across Devon are facing tough times in Labour's recession. These firms, from our corner shops to local pubs, are the lifeblood of our local community. A responsible government would do more to help them.

"Yet Gordon Brown is making it difficult for small firms to claim the tax relief to which they are entitled. He is adding to their misery by finding new ways to drive up business rates by stealth.

"Conservatives would ensure that small firms automatically receive rate relief, cutting their paperwork and tax bills, giving many of them a fighting chance to stay afloat."

The Local Government Association estimates 870,000 firms are eligible for the rebate but less than half have claimed - a take-up rate in the region of just 48 per cent.

After rent and staff, business rates are the next biggest cost and Mr Swire says that research shows 32,300 businesses in the UK will fail in 2009.

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