Family businesses and entrepreneurs fear Brown
Fears grow that CGT clampdown will hurt SMEs
Entrepreneurs and family companies are so worried that
Gordon Brown plans to
clamp down on capital gains
tax relief when he becomes prime minister, that more and more of them are
looking to sell, according to a report on
Thisislondon.com.
Brown has already begun looking at ways of tightening controversial tax
breaks enjoyed by private equity firms, but fears are that small businesses
could also be hit.
The key concern is ‘taper relief’, under which someone holding shares in
their own company or any unquoted business will pay CGT at only 10%, rather than
the full 40%, provided they hold them for at least two years.
The move was aimed at encouraging entrepreneurship, but has been found to be
hugely beneficial to private equity executives in helping to reduce their tax
bills.
Stephen Alambritis of the Federation of Small Businesses said that if
consultation did take place on this issue, entrepreneurs will start to sell
up,’.
Further reading:
Brown to offer foreign subsidiary tax breaks
Brown ‘ready to stamp out private equity tax breaks’
Brown vows to review private equity tax