Stability in the Tax System needs to support Entrepreneurship
The Institute of Chartered Accountants in England and Wales (ICAEW) has said that doing business in the UK is too uncertain and expensive, and more stability is needed in the tax system. Their comments were in response to the government’s call for evidence around ways the tax system can better support entrepreneurs.
The ICAEW considers that blunt tax hikes and tax policies have disproportionately increased the cost base of UK businesses and that these need to become a thing of the past.
They also point to a lack of meaningful incentives that would unlock investment from serial entrepreneurs and family office investors. They include an example that an outright capital gains tax exemption could be more effective in encouraging the reinvestment of capital into new ventures.
Recent changes to the inheritance tax and domicile rules have also complicated reinvestment decisions and have already tempted some to move funds abroad.
From April 2026, the income tax relief that can be claimed by someone investing in a venture capital trust (VCT) will be reduced from 30% to 20%. The ICAEW have called for this decision to be reversed.
The ICAEW have also suggested that changes be made to the enterprise investment scheme (EIS) and enterprise management incentives (EMI) to make them more effective and enable entrepreneurial businesses to attract talent.
The government’s call for evidence on the subject closed on 28 February 2026; it will be interesting to see what changes come from the results.
Business News
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