Let's keep the wealthy foreign investors on board

By Amanda Vigar, Managing Partner, V&A Bell Brown LLP

Britain is open for business… or is it? It certainly should be with unemployment rising and the economy in the doldrums.

At a time when this country needs more taxpayers and more wealth-producing, industry- investing people, we’ve managed to make rich foreigners feel less welcome and it looks like they’re taking their money elsewhere. The country needs that like a hole in the head!

According to HM Revenue and Customs’ own figures, the number of non-domiciled taxpayers has fallen by 2,000 in a year. It may have something to do with the £30,000 annual non-dom levy they’re being asked to pay for the privilege of putting their stake in the UK.

According to a Freedom of Information request, the damning stats show that the number of non-doms has plummeted from 140,000 in 2008 to 116,000 now. These are just the ones that are paying the levy – so likely to be on the wealthy end of the spectrum!

This group of highly informed, highly mobile, enormously wealthy wealth producers is, not surprisingly, also very well informed. And they have highly skilled people to do their sums for them, and they have decided that the UK is not the proposition it once was – we’re not longer seen as a “light touch” tax and regulation economy.

Foreign investment is always important to a successful economy and the need to stay attractive to international money is imperative to our country’s recovery and growth.

The £30,000 annual tax levy on non-doms who have been in the UK for between seven and 12 years is not helping us. The levy is only part of a raft of other tax measures, introduced or being discussed, which are gaining us a reputation for being less welcoming to people with real spending power than we once were.

We need to keep access to investment open and easy. To do otherwise seems contrary to the ideals of a free market and at odds with our role as an international centre for investment and ideas.

These non-domicile taxpayers will continue to take to their luxury launches and abandon the good ship Britannia if they feel the weather is no longer set fair. While they’re aboard, they will invest in the UK and create jobs. When they’re abroad, they will invest their money abroad. Time for a change of tack!

Statement from Business Battle-axe Amanda Vigar on the passing of former PM Margaret Thatcher

Amanda Vigar, Managing Partner, V&A Bell Brown LLP, the Business Battle-axe, said: “Lady Thatcher was a towering figure in UK politics and her legacy is with us to this very day. I firmly believe that without her strong and decisive leadership and the positive economic climate that she fostered many businesses would simply not have even got off the ground.

“Her resolute determination and strong leadership helped to release Britain from the stranglehold of trade union dominance and her free market policies helped to inspire many ordinary people to start their own businesses and to buy their own homes. On a personal level, she has been a huge inspiration to me, and I firmly believe that her legacy will live on for many, many years to come.”

Smaller businesses need more help to survive yet alone thrive!

By Amanda Vigar, Managing Partner, V&A Bell Brown LLP

I can’t help thinking the Budget was a wasted opportunity. There were some good things in there for smaller businesses, but there were also measures that should, and could, have been included. Add to that it was a Budget of “jam tomorrow”; all in all, it was rather a let-down.

The cut in mainstream Corporation Tax won’t directly help smaller businesses, but it will help to attract overseas businesses to set up in the UK. The Employment Allowance is good news as well as the first £2,000 will be taken off employers’ National Insurance bill. This will mean that many small businesses will no longer have to pay employers’ NI. For a small business owner who is thinking about taking on their first employee a huge barrier will be removed. That’s the good news.

Perhaps the biggest Budget disappointment for small firms was that George Osborne did not announce any curb on business rates and there was no reduction in the rate of corporation tax for smaller businesses. Rates will have risen 13% in three years at a cost to retailers of about £175m a year.

With lending to small businesses down 25% in real terms since its peak in 2009, and almost 10% lower than in 2006, I’m also disappointed that there was no announcement on the Business Bank that has been advocated by the business secretary, Vince Cable. Whilst we don’t want to go down the road of what was tantamount to irresponsible lending in the early years of this century, the tides have turned too far the other way in more recent times. The proposed Business Bank will not lend directly to small businesses, but will give advice on suitable facilities and schemes as well as providing cheap wholesale finance for alternative lenders and so called 'challenger banks’.

More and more businesses feel there is no point in even trying to raise finance to grow, and that’s a real concern in our fragile economy. Baby steps are not what we need right now. We need real action that can give smaller businesses the kick-start and confidence they need to grow and survive. It’s tough out there and there is little real sign that it’s going to get any better fast. So, even though I’m not an advocate of government meddling, I do think that the Coalition should act on lending. There are private finance initiatives springing up, but these need to be co-ordinated, and the Business Bank could certainly help. A client who’s been in business for about twenty years said to me the other day that he wouldn’t have been able to get his small business off the ground had he been starting out today. The barrier is, of course, the lack of finance out there. So, come on Coalition, put some real timescales in place for this new bank, as it’s a good idea, but now’s the time to put your money where your mouth is!