Members of the British Chamber of Commerce (BCC) have called on all three major political parties to both simplify the UK’s overly complicated tax system, and reduce the amount of tax business pay before they generate a profit.
The demands, made in the BCC’s latest manifesto, A Business Plan for Britain, has also called on future governments to freeze business rates for all companies until 2017 and reform the entire system by 2022.
The UK has some of the highest tax and business rates in Europe, which some have said has held back the full potential of British companies following the recession.
Mike Spicer, the BCC’s director of research, is one of the organisation’s members calling for a fresh review of taxes and rates.
“The weird thing about businesses rates is that it’s the only tax where the rates are reset each year, in order to yield the same amount of revenue,” Mr Spicer said.
“We have had a few occasions over the last few years where a spike in inflation [when rates are reset] sets the rates for that year.”
He also criticised the way rates are currently calculated and said the next government needed to re-evaluate whether property was a fair way to set tax, especially considering the recent rise in prices.
Spicer said the recommendations needed to take place in order to deliver an internationally competitive local tax system, which would help businesses and sustain growth and development.
The BCC’s call for action has been echoed by the Federation of Small Businesses (FSB), who has described the business rate system as “complicated, opaque, regressive and unresponsive” to changing economic environments.