Below is the text of Mr Major’s written Parliamentary Answer on Small Businesses on 24th July 1989.
Mr. David Shaw To ask the Chancellor of the Exchequer if he will make a statement on the achievements of his Department and his policies in helping small businesses over the last 12 months compared with the previous 12 months; and if he will publish the performance indicators by which his Department monitors those achievements and the statistical results of such monitoring.
Mr. Major The Government’s economic policies are designed to maintain a vigorous economy in which business and enterprise can flourish. Over the last 12 months we have continued our commitment to this goal. Among the specific measures helpful to small businesses introduced in the last Budget were for the small companies’ lower corporation tax rate of 25 per cent. profit limit raised by 50 per cent. to £150,000 and the limit for receiving transitional relief raised to £750,000; simplification of pensions rules and substantial increases in personal pension contribution limits; improved tax reliefs designed to encourage employee participation in PRP and employee share schemes (including ESOPS); abolition of close company apportionment rules; introduction of the receipts basis of schedule E (a simpler system for the assessment of earnings). extended relief for pre-trading expenditure; VAT registration threshold raised broadly in line with inflation; CGT gifts relief retained for business assets.
We are continually looking at ways of reducing the burdens on small businesses. In addition to the continuous review of forms, explanatory notices and leaflets with the aim of providing guidance which can be easily understood, the following changes have been achieved in the last 12 months: The completion of the computerisation of PAYE and extension throughout the country of computerisation of the tax affairs of the self-employed. From 1 July 1989 the scope of the Community carnet was extended. Development work has taken place for the introduction on 1 August 1989 of two fast lane systems which will speed up the clearance of certain EC imports. Development work is proceeding on a new computerised system for the handling of import export freight which will speed up the clearance of goods. We have also carried out thorough examinations of:
The VAT cash accounting scheme;
VAT bad debt relief;
Export data capture;
VAT second hand schemes; and
PAYE communications between employers and the Inland Revenue
The results of these reviews are under consideration.