The Chancellor also promised that the UK banks would be encouraged to do all they could to help finance small business. He congratulated RBS for its recent pledge to help SMEs and warned other banks: “this should be the benchmark to all UK banks.”
Darling says seven UK banks will be allowed access to £1bn of European money to be lent to small businesses by 2009.
He also revealed the creation of a SME finance scheme where businesses could borrow between £1000 and £1m. He says: “We want businesses to borrow flexible, affordable and accessible loans”.
Aifa director general Chris Cummings says: “We are delighted to welcome this boost to small businesses in these difficult times. The short term measure to defer the increase in corporation tax is a positive step.
“IFA firms, like other small businesses, have been affected by the financial turbulence. That is why this measure to reduce the tax burden for small business is the right thing to do. We also welcome the other measures to help smaller businesses announced today – especially the Government’s commitment to keep banks lending to small businesses.
“However, we would have liked to have seen the review of business rates deferred as this may offset any reductions in corporation tax.”