UK SMEs are calling on the government to address critical financial barriers in the upcoming autumn budget.
New research indicates a rise in business confidence, but concerns over potential tax increases persist.
The latest SME Confidence Tracker reveals a rebound in business optimism post-election, with 68% of SMEs expecting sales to increase over the next six months. This marks a 7% rise since March 2024.
With inflation stabilising and interest rates lowering, 63% of SME leaders feel more confident about making capital investments. Furthermore, 52% are more inclined to pursue major investments following the General Election.
However, the prospect of tax hikes in the upcoming budget remains a significant concern. An overwhelming 87% of respondents are calling for better tax incentives.
Derek Ryan, UK Managing Director of BFS, emphasised the importance of government support, stating: “SMEs are finally feeling confident enough to invest, but the Prime Minister’s warning of a ‘painful’ budget risks undermining this.”
Access to finance continues to be a major challenge, with 49% of SMEs describing the finance landscape as complex.
Despite an increase in commercial finance approvals, many SMEs still find the process daunting.
Only 18% of SMEs have utilised the Bank Referral Scheme, highlighting the need for more streamlined processes and better educational resources for navigating financing options.
The Labour Party’s proposals to improve SME financing include reforms to the British Business Bank and the Bank Referral Scheme, which are seen as promising by experts.
Sandeep Dhillon, CEO of SME marketplace Talmix, stressed the need for immediate clarity on tax policies and financial support, particularly for the tech sector.
An astounding 80% of SMEs are seeking better educational resources to navigate funding options.
The complexity of the finance landscape makes it essential for the government to provide clear and accessible information.
The tech sector, in particular, has seen a decline in investment, underscoring the need for targeted financial support.
Immediate clarity on tax policies and support mechanisms are crucial for maintaining growth in this innovative sector.
Dhillon highlighted the urgency for decisive action to bolster confidence and investment within technology businesses.
Experts agree that supporting SMEs should remain central to the government’s economic growth plan.
Derek Ryan warned that failing to provide adequate support could undermine the newfound business confidence among SMEs.
SMEs are urging the government to act swiftly to address their concerns.
The upcoming autumn budget presents a critical opportunity to implement measures that support SME growth and stability.
The upcoming autumn budget is a pivotal moment for the government to address the financial concerns of SMEs.
Ensuring better tax incentives and access to finance will be essential for sustaining the current momentum in business confidence.
