The issue of tax vied with red tape as the number one concern of attendees at the FPB’s Small Firms’ Summit, in Westminster, on 17 October.

Specifically, participants’ cages were rattled by the changes to Capital Gains Tax, announced by Chancellor of the Exchequer, Alistair Darling, in his recent Pre-Budget Report. Even the famously forthright Rt Hon Charles Clarke MP, who was the keynote speaker at the event, was forced to concede that the Government could be forced to think again about scrapping the 10% taper relief rate on Capital Gains Tax.

If it goes ahead, as is likely, it means that, from April, retiring businessmen and serial entrepreneurs who want to sell up and move on will have to pay almost double the amount in tax than they previously did. It is widely believed that the move was designed to catch out private equity firms, which often break up their assets to make them appear smaller than they really are. However, in reality, the Chancellor has also caught up smaller businesses in his net.

The FPB launched a petition calling for the measure to be reversed. The Shadow Chancellor, George Osborne, visited the FPB’s offices in Knutsford, which is in his Tatton constituency, to pledge his support by signing the petition. So far, about 800 owners of smaller businesses have done the same.

Following the backlash, the Government has suggested introducing £100,000 in tax relief to business owners who decide it is time to retire and want to sell up. This offer was supposed to pacify our many members who now have to rethink their retirement plans.

At best, the FPB believes that this is a very small step along the road to easing the heavy tax burden that is limiting smaller businesses from being able to compete against bigger businesses. At worst, it is a token gesture designed simply to quell the criticism. In the IT industry, tax burdens are preventing smaller businesses from updating their equipment. This also applies to costly software programmes, which members can now rent from the FPB in order to make savings.

Along with other moves, such as raising the lower rate of corporation tax in recent years, and at the same time cutting the higher rate paid by larger firms, the FPB is concerned that the hike in Capital Gains Tax is part of a broader policy of forcing smaller firms to fork out and cover the tax breaks handed to big businesses.

If the make-up of Gordon Brown’s new Business Council, which includes celebrities such as Sir Alan Sugar but no one to represent the views of smaller businesses, is anything to go by, it is the bigger boys that have the Prime Minister’s ear.