Enterprise Nation calls for small business tech skills boost and increased SME procurement in 'tax giveaway' Budget

• Tax breaks to improve tech skills

• Increase Government procurement spending with SMEs

• Further progress to prevent late payments to small firms

The chancellor must deliver a significant tech skills boost for small businesses in a tax giveaway Budget, says small business support platform Enterprise Nation.

The 120,000-strong membership community says the UK's start-up, micro and small businesses urgently need targeted tax breaks to help them increase basic tech skills to become more competitive, as well as further increases to Government procurement spending with SMEs to boost growth.

Enterprise Nation research revealed worrying gaps in tech uptake and found businesses could get as much as three and a half weeks' productive working time back if they fully embraced even basic technology.

Other research suggests the UK is lagging behind other G7 nations in digital investment and performance, and with the increase in new technology such as artificial intelligence, a consistent lack of investment could see the gap widen even further.

The community suggests the Government has made significant inroads into solving the late payment issue that affects small firms disproportionately, yet it still must go further to help more businesses that rely on prompt payment for cash flow.

Emma Jones CBE, founder and CEO of Enterprise Nation, said:

"We firmly believe that by addressing these priorities, the government can significantly contribute to the growth and prosperity of small businesses and prevent UK firms falling behind those in other nations in terms of technology.

"A thriving small business sector not only fuels economic growth but also fosters job creation and innovation, ultimately leading to more prosperous and resilient communities. The success of small businesses is intricately woven into the fabric of our society, and it is our duty to support them in every way possible."

The community says small businesses need access to five key resources; access to markets, technology, finance, people and space. The organisation has written to the Chancellor calling for reform in each area.

Access to Markets

The main asks include delivering on the Government's ambition to spend 33 per cent of its procurement budget with small firms and trialling an Export Tax Credit or Export Vouchers to incentivise exporting among small businesses.

Access to Technology

The community is asking for the Government to reward businesses for adopting technology with new financial support and offer targeted tax incentives, and time-limited subsidies, to support businesses with the cost of adopting technology.

Specifically, the community is calling for enhanced support of 140% on the first £50,000 of expenditure on productivity enhancing digital services, which equates to an additional 40% versus standard business expenditure. This will empower small businesses to embrace digitalisation and harness emerging technology, such as AI, to become more productive and grow sustainably.

Access to Finance

The community wanted to see the Government build on recent progress to stamp out late payments by mandating 30-day terms to larger firms procuring from smaller ones while expanding the Government's Making Tax Digital scheme to include companies with a turnover of less than £20,000 per annum.

Under Access to People, the reforms suggested include improving support for older people who want to get back into work or self-employment, conducting a review on the feasibility of small business tax incentives to upskill their workforce and reforming the Apprenticeship Levy to enable businesses to transfer a higher portion of their Levy funds directly to the small businesses they partner with.

Access to Space

This is about opening up unused and empty spaces including for shorter leases or pop-up use and a small business incubator in every high street. The community wants the government to consider introducing a levy on commercial-to-residential transfers to discourage tax motivated shifts from commercial to residential property.

It also wants it to consider scrapping and replacing the business rates system with a tax on the underlying land values, not productive investment, or if the business rates system is retained, freeze them until the Bank of England's inflation target of 2% is met and empower local authorities to have more responsibility over business rates reliefs and exemptions for small businesses, coworking spaces and charities.

ENDS

Case study

Garden planner Joanne Christoforides, CEO and founder, Jo Make Me A Garden, based in Bridgewater, Somerset. Joanne said:

"Someone needs to teach the language of tech. Not knowing how to talk to people in the tech sector is a huge barrier to progress. I wasted time and money on unsuitable tech that was quickly abandoned.

"A source of trusted recommendations would be really useful! Support focused on implementing systems early on is key. Let's have more of the basics; the vital things, whereby knowing or not knowing can make or break a business."

About Enterprise Nation

Enterprise Nation is a business support platform and membership community delivering support to more than 800,000 small businesses every year. Its aim is to help people turn their good ideas into great businesses -- through expert advice, events, acceleration support and networking.

Enterprise Nation was founded in 2005 by British entrepreneur Emma Jones CBE, also co-founder of national enterprise campaign StartUp Britain. She is author of best-selling business books. www.enterprisenation.com