Tax greater SME concern than credit crunch

The credit crunch is not as much of a barrier to business as tax and regulation changes, according to the Forum for Private Business (FPB).

According to the latest FPB quarterly survey of small to medium enterprises (SMEs), over half of firms saw tax as a significant barrier to growth, while 60% cited employment law.

In contrast, just over one-tenth of SMEs claimed that access to finance was causing problems.

Nick Palin, the FPB's director of finance, said: "Issues of tax and over-regulation are still the main barriers to growing business in the UK."

"Addressing the disproportionate tax system and removing regulatory hurdles must be the government's top priorities in supporting small businesses."

In a previous study by the FPB conducted at the end of last year, close to 100% of the British SMEs claimed governmental tax changes had made the UK a worse place to do business.

The FPB stated earlier this week that the activation of the Small Companies Act 2006 was set to add further pressure to businesses in the UK.