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Chancellor 'must help restore business confidence'

 
General News |  23/11/2011
Chancellor 'must help restore business confidence'The chancellor of the exchequer needs to take action to boost business confidence in the short-term, it has been claimed.

Michael Izza, chief executive of the Institute of Chartered Accountants in England and Wales (ICAEW) said the economy is "at a critical stage", with the risk of a double-dip recession very real.

He claimed there has been a collapse in business confidence in recent months, with private sector sentiment falling at the fastest rate since 2004.

As such, Mr Izza has called on George Osborne to allay the fears of business operators by announcing a range of business-friendly measures in his upcoming Autumn Statement.

ICAEW has called on the government to extend the moratorium on new domestic regulations for microbusiness, lasting until 2014, to small and medium enterprises and larger companies where possible.

The body also wants to see the rate of income tax relief on the Enterprise Investment Scheme raised up to the marginal rate, while the research and development tax credit is maintained.

Reducing the 20 per cent rate of VAT on general repairs and refurbishment of dwellings to five per cent for two years will also help, said ICAEW.

The institute has called on the coalition to support companies to export through schemes such as the Regional Growth Fund, especially when conducting business in non-EU and rapidly growing markets.

And it also wants to see an extension to the Enterprise Finance Guarantee Scheme.

ICAEW said that restoring business confidence is the best way to motivate businesses to invest capital.

"The government should redouble its efforts to restore confidence in the short-term in an effort to avoid the risk of a double-dip recession in early 2012," the institute stated.

"The Autumn Statement is a key opportunity for the government to outline how it will restore confidence."

Posted by Stephen Wilkinson

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