Tax-delays boost for struggling businesses

STRUGGLING businesses in Oldham were handed a lifeline last night after the Government announced a scheme which allows them to delay paying tax will be extended.

As of last night, 770 agreements with businesses across the borough had been made, delaying £12 million of tax to free up more cash to help them in the recession.

The scheme was set up November last year to help any businesses finding it difficult to pay their taxes and duties, including income tax, corporation tax, VAT, PAYE, and National Insurance.

In his pre-budget report yesterday, Chancellor Alistair Darling said the time to pay scheme would be extended for “as long as it was needed”.

He said: “To ease problems with cash-flow and access to bank lending, we deferred tax rises and extended tax allowances for businesses.

“Because we chose to intervene, the rate of business insolvencies is far lower than would have been expected. In the recession of the early 90s proportionally twice as many businesses went under.

“They get additional time when they need it most, and because firms continue trading the likelihood of companies paying the tax owed increases. The scheme will be extended for as long as it needed.”

Mr Darling also announced bankers will be hit with a one-off 50 per cent tax on bonuses above £25,000, inheritance tax will be frozen at £325,000 until 2011 and VAT will return to 17.5 per cent from January.

National Insurance will rise by 0.5 per cent from April, 2011, and under 24s will be guaranteed training or work when they have been out of work for more than six months.

An extra £150 million was announced for investment in Warm Front insulation scheme expected to benefit 75,000 households reduce their fuel bills.

£50 million was set aside for families upgrading inefficient boilers to energy-efficient models to be given a £400 cash back.

Oldham West and Royton MP Michael Meacher said: “It is excellent news for businesses and I am pleased the scheme is being extended, keeping people in work and even creating extra employment.”