Published: 17:47, 12 January 2021
| Updated: 17:49, 12 January 2021
Tunbridge Wells MP Greg Clark, a former business minister, said there was a danger that withdrawing various tax exemptions could force small businesses, particularly in the hospitality sector, to go under at a critical time.
Speaking in a debate at Westminster, he pressed for an extension to a range of tax relief schemes to protect those businesses who would be in the front line of the economic recovery.
The debate came about after a petition was launched to call for the government to appoint a minister for hospitality and amid fears that thousands of businesses could collapse. The “Seat At The Table” campaign has been backed by leading restaurateurs and others in the industry.
Mr Clark said: “Having come this far and with the investment made in keeping these businesses alive in the hospitality sector, we must make sure that we get through the next few weeks so they can continue to thrive.”
He cited measures to safeguard businesses, such as the furlough scheme, business rate relief and the ‘eat out to help out’ scheme as a success but criticised government plans to bring some to an end.
“Just as the government did not expect us to have this pandemic for over a year, neither did hospitality businesses many of which are small, personally run and without access to resources or cash.
“Yet these pubs, cafes and restaurants will be at the forefront of the recovery when the lockdown ends.They will be the first to offer job opportunities to young people; to give business to their suppliers and to attract people back to our high streets; city centres and villages across the country and they will also be the first to pay taxes to the exchequer.”
He cited a survey of 36 local businesses in his constituency and Tonbridge and Malling that showed that in terms of taxes and PAYE in the year before the pandemic, they had paid £4.4m in tax, but the value of furlough and grants amounted to about £3m.
“The point is that these businesses pay their own way and if they survive they will pay their way in the future.”
He said the government should reconsider the plan to require businesses to pay National Insurance contributions for staff who have been furloughed.
He also called for the business rates holiday and the VAT cut to be extended because the pandemic had lasted longer than expected and for businesses to be able to repay loans “so they can survive these crucial few months”
As many as 250,000 small businesses could be at risk of collapsing over the next 12 months, according to the quarterly Small Businesses Index (SMI).