Taper Relief Change - Business groups meet with Chancellor over CGT concerns

Less than two weeks after the Pre-Budget report, four key business groups have met with the Chancellor to protest over the Capital Gains Tax / taper relief changes which are due to take effect from 6th April 2007.

From next April, the capital gains taper relief regime will be abolished in favour of a single, flat rate 18% capital gains tax on business sales. Previously, if you held shares in a company for a period of time, you would pay just 10% on proceeds from a business sale.

Clearly, many small business people have been furious about the Chancellor's proposals, as it is clearly an anti-enterprise measure.

On Monday, representatives of the FSB, CBI, BCC and IoD attended a Treasury meeting to discuss the tax changes. According to reports issued by these groups following the meeting, it appears that Mr Darling is prepared to consult over the proposed changes.

Richard Lambert, Director-General of the CBI, said:

"Mr Darling said he would be happy to work with the four business groups to develop measures to stimulate enterprise in the UK, and that he would listen to the group's proposals for a way forward on capital gains tax."

John Wright, FSB Chairman, said:

"We have put across our members’ views to the Chancellor in a forthright manner and he has agreed to further consultation with us. We will now be presenting more evidence and information to the Treasury to highlight the damaging nature of this potential change to the tax regime for small businesses before next year’s Budget. We are hopeful that a successful outcome to this situation can be achieved through meaningful consultation with the Treasury."