Small Business Bonus

By Andy Willox

Published:

MANY months of lobbying on behalf of the Federation of Small Businesses Scotland’s 20,000 members recently paid off as the Scottish Government stuck to its manifesto commitment and implemented the Small Business Bonus.

The bonus addresses the statistical evidence that a disproportionate amount of a small firm’s turnover is paid out in business rates compared with larger competitors.

Although it is not a direct response to the credit crunch, the policy will also help the thousands of small businesses which are struggling with the current economic downturn affecting the UK economy.

The bonus will have a very real effect on the future economic health of Scotland.

It will have a substantial and significant impact on the cash flow of thousands of small businesses all over Scotland and in every single business sector and geographic area of Scotland, especially in rural Aberdeenshire and the north-east.

In a nutshell, the scheme will reduce business rates for small businesses with a rateable value of less than £15,000 by between 20% and 80%. And this time next year, 120,000 of the country’s smallest businesses with a rateable value of less than £8,000 will pay nothing in business rates, while an additional 30,000 will have their rates bills reduced by either 25% or 50%.

The Scottish Government has put its money where its mouth is and clearly demonstrated that it is listening to Scotland’s 270,000-strong small business community.

And the bonus is just one of a number of bold initiatives that is bringing a sense of vibrancy and optimism to Scotland and will help the country to close the economic growth gap with the rest of the UK by 2011.

The bonus is very close to the FSB Scotland’s manifesto recommendation and comes after years of lobbying at local and national level, persuading politicians at all levels to recognise the contribution small businesses make to society and the economy and consider the obvious merits of any scheme which helps small firms to make a greater contribution.

Andy Willox is Federation of Small Businesses Scotland policy convener and runs Goldstar, a property maintenance business in Aberdeen