CIOT warns tax system must do more than aid investors

The Chartered Institute of Taxation (CIOT) has urged the government to do more to support entrepreneurs, cautioning its current call for evidence too narrowly targets investor reliefs and risks ignoring small and growing businesses’ tax and administrative challenges.

Responding to HM Treasury’s call for evidence on tax support for entrepreneurs, the professional body of tax advisers contends that growth stems less from increased capital investment more from cutting regulatory and administrative barriers that hinder hiring, market expansion and efficient tax compliance.

The CIOT has called on the government to broaden its scope when compiling existing evidence, including from its Small Business Strategy inquiry and previous Office of Tax Simplification reviews, to analyse how tax policy supports sole traders, small partnerships and owner-managed businesses at every stage of their development.

Pete Miller, chair of CIOT’s owner managed business committee, said: “Entrepreneurs come in all shapes and sizes – from local tradespeople to high-growth tech founders. The call for evidence is right to look at start-up investment reliefs, but it misses the bigger picture. For the UK to have a truly entrepreneurial economy, the tax system needs to work for all businesses with growth ambitions, not just those seeking venture capital.

“Simplification must be at the heart of any reforms. The current reliefs are often so complex that businesses need expensive specialist advice just to access them. That complexity is itself a barrier, and it erodes the effective value of the relief available.”