Call for social investment tax reliefs
The government should provide new tax reliefs to encourage greater investment in businesses which benefit society, an expert has claimed.
Nigel Kershaw, chief executive of Big Issue Invest - the investment wing of the Big Issue magazine - claimed it was imperative that the Treasury rewards those who back social enterprises, businesses which plough all or the majority of their profits into social or environmental causes.
Pointing out that investors in traditional businesses can claim a whole raft of tax reliefs, Kershaw said because the same is not available for social investments, many people are put off from getting involved.
"Lets make social enterprises the equivalent of young innovative SMEs," he told delegates at Tuesday's Good Deals conference in London. "We know our market and how to make change happen but there is no incentive to invest in us while we sit between business and charity."
Kershaw also criticised the make-up of the government's Community Interests Company (CIC) intiative, a company format created to boost the number of social entrepreneurs.
He said the cap on dividends which limits the return on investment for an individual backing a CIC makes the whole scheme a "half hearted measure". Claiming that only three of the UK's 1706 CICs have so far received inward investment, Kershaw added: "We need to open it up so people can take the risk with social enterprises."
Jonathan Bland, chief executive of the Social Enterprise Coalition, agreed that an attitudinal change is required. "We need a bigger, grander vision for what social enterprise can do," he said.
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BusinessZONE - 6-May-2008
Categories: News
Story read: 1940
