Directors call for fiscal discipline
21st May 2015
The majority of company directors want the government to press ahead and achieve a budget surplus by the end of the parliament, an Institute of Directors (IoD) member survey has found.
Members of the IoD have listed their top priorities for the new government, which include a reduction of the deficit, increased spending on infrastructure and the lowering of taxes for businesses and individuals.
A majority of 85% support the government's goal of eliminating the budget deficit by 2020. 12% of respondents want to achieve this entirely through spending cuts while just 1% said tax rises should be the only means of getting the deficit down. A fifth thought an equal mixture of spending and tax rises would be the preferable way of achieving a surplus.
Of the 1,211 IoD members surveyed:
- more than half opposed a rise in national insurance, income tax and business rates
- 56% want the government to invest in the country's broadband infrastructure
- 55% said there should be more investment in energy generation
- many want the government to spend more on developing transport infrastructure: railways (50%), roads (44%) and airports (34%)
- 89% support a crackdown on tax avoidance.
Simon Walker, director general of the IoD, called on the government to stick to its pre-election plans to reduce spending:
"Returning the budget to surplus must be the overriding goal in this parliament, but businesses want the emphasis to be on finding further reductions in spending, not significantly raising taxes.
"If we do not even begin to deal with the pile of debt, the situation will only be more dangerous if we encounter another economic shock."
Walker also urged the government to implement "much more fundamental [tax] reforms":
"A hugely complex tax code also remains a barrier to growth for many businesses.
"Businesses want national insurance brought down, business rates reformed and a tax code which encourages investment and entrepreneurialism. This will not be achieved by tinkering at the edges."
We can help you plan for your business's future. Speak to an adviser today.