The 'Time to Pay' scheme, set up by the last government to allow businesses hit by the recession to delay payment of tax, may be abolished in next week's Budget.
Since being set up in November 2008, the initiative has seen £5.3bn worth of tax payments, helping more than 200,000 businesses ease their cash flow problems.
The previous government extended the facility by a further four years, but it could be axed in next week’s Budget as part of a public spending cull to tackle the public deficit, according to the Forum of Private Business (FPB).
"The Business Payment Support Scheme remains a real lifeline for many small firms struggling with cash flow and this will be the case for a while. Now is not the time for it to go," warned the FPB's head of campaigns Jane Bennett. "Re-balancing the economy is clearly a major priority but sacrificing genuine support like this will only jeopardise small businesses and hinder sustained recovery. The message is clear – it is important to preserve ‘time to pay’ and other viable small business support schemes in the Budget."
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