Cost of doing business is rising - we need to ask why?

As we enter a new tax year, I find it disconcerting to see that the cost of doing business is rising.

Fri 07th, Apr

As we enter a new tax year, I find it disconcerting to see that the cost of doing business is rising. 

At a time when the need for business creation and growth has never been more urgent, we make starting and running a venture ever more expensive and complex.

The only bright spots seem to be the reduction in corporation tax and the u-turn on the rise to National Insurance Contributions for the self-employed.

Everywhere else we look, costs are rising. Companies of all sizes will now see the introduction of the Apprenticeship levy, Immigration Skills Charge, a new National Living Wage and pensions auto-enrolment.

Added to that you have a significant rise in input costs caused by the weaker pound.

It’s a simple equation. When the costs of doing business rise something has got to give.  Either firms will pass on those extra costs for customers, or they will be reluctant to hire staff. Hardly a great recipe for growing an economy.

I have, for a long time, urged for a review of the business rates system. It is fundamentally flawed and imposing pressure on businesses every day.  

But any hope of a review is some way off, and those small firms are hurting now.

The Government’s Making Tax Digital initiative, will require almost all companies to file tax returns online four times a year – which means another investment of both time and finances for business owners.

Is it any wonder this month has been designated Stress Awareness Month!

But it’s not all doom and gloom. We see every day among our chamber members and in our fledgling Spark-Up entrepreneurs, how the spirit of enterprise is alive and well in our city region.

In sectors such as a visitor economy and creative & digital we are continuing to see growth, innovation and collaboration. Our last Quarterly Economic Survey shows business confidence in the city region is at an all time high. 

Now is the time to support businesses to grow and scale. Give entrepreneurs the right help and encouragement and in return they will turbo-charge our economy and make us all more prosperous.

Jenny Stewart

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