Small firms need more than talk if they are to weather the economic downturn, business lobby group the Federation of Small Businesses (FSB) has said.
The FSB is calling for government to create a £1bn ‘small business survival fund’, which would replace the Small Firms Loan Guarantee Scheme and help small firms win short-term funding while they battle the downturn.
The FSB is also questioning the availability of previously announced funds from the European Investment Bank.
In addition, the business lobby group wants the chancellor to scrap an increase in small business corporation tax, due to come into force next April.
Small business corporation tax will rise from 21% to 22% next year, while at the same time taxes for large enterprises are expected to be reduced.
The FSB’s national chairman John Wright said government should be doing more to help small businesses in their hour of need.
“Small businesses are facing a crisis as finance dries up and the cost of finance rises. The government must do everything it can to ensure small firms do not need to turn to urgent and expensive sources of finance.
“The UK’s 4.7 million small businesses need more than talk, we need action.”
© Crimson Business Ltd. 2008