By Max Clarke
While severe weather has had a negative impact on small firms, a snap poll suggests that fuel duty will have more of an impact on businesses.
A quarter of small businesses had to close during the recent severe weather and heavy snowfall, many for at least five days and overall costing the majority up to £5,000, new figures from the Federation of Small Businesses (FSB) show.
In a snap poll of 1,300 members, 24 per cent of small firms said they had to close, of these 37 per cent said they closed for up to five days and an additional seven per cent closed for more than five days for a number of reasons, including transport disruption, staff absences and loss of access to their premises.
In addition, on 4 January planned tax increases came into force, raising VAT to 20 per cent and putting fuel duty rates at a record high. More than a third (39%) of small businesses said that the rise in fuel duty will have a significant impact on their business, followed by the rise in VAT (27%), while only 24 per cent saying snow had had a similar impact.
The severe weather and heavy snowfall caused huge disruption to small firms with a third (30%) claiming that up to 50 per cent of their staff were absent for at least one day. The impact of the snow cost six in 10 (58%) up to £5,000 and 13 per cent more than this.
The FSB is concerned that the unprecedented weather when combined with the high rates in fuel duty will put small businesses on a knife-edge.
The FSB is calling on the Government to put in place its promised fuel duty stabiliser — a mechanism to ensure an automatic freeze on fuel duty increases and a reduction in duty to match any increases in VAT revenues from higher pump prices — to avoid a relentless flow of fuel duty increases.
John Walker, National Chairman, Federation of Small Businesses, said:
"Heavy snowfall and severe weather has put a strain on already hard-hit small firms at such an important time for businesses. This coupled with the increase in VAT and the huge rise in fuel duty is really tarnishing the potential of small businesses, at a time when the Government is putting much of its hope into the sector to put the economy back onto firm ground.
"While the Government cannot control the weather, it can reduce the impact record fuel duty rates has on everyone, not just small businesses. As small firms recover from the severe weather, the same cannot be said for the tax increases which the Government have said are here to stay. It is unacceptable that the Government has u-turned on its manifesto promise to introduce a fuel duty stabiliser and it is vital we see this put in place immediately to remove some of the strain from small businesses so they can get on with the job at hand of creating jobs and helping to grow the economy."