Government plans 10% tax hike for Islington businesses

5.47.12pm BST (GMT +0100) Mon 10th Aug 2009

Councillor Lucy Watt with Lib Dem Shadow Chancellor Vince Cable MP.

Gordon Brown's Labour Government is planning a 10% tax increase on businesses in London. Under new plans from Labour, London's businesses will be forced to hand over an extra £565 million to the Government. Islington's Liberal Democrats have condemned this latest tax hike as an attack on local businesses who are already struggling in the recession.

Gordon Brown's tax increase, a result of a country-wide revaluation, comes on top of other recent news that Tory Mayor Boris Johnson will be increasing business tax on 1/8 of the borough's businesses to pay for Crossrail.

Lucy Watt, the Lib Dem councillor responsible for Islington Council's links with the local business community, said:

"I've spoken to lots of local businesses recently and their top concern has been level of business rates. They want them cut because of the recession- not put up.

"Gordon Brown's latest 10% tax hike will put local business at risk. That's undeniable. We want Islington to emerge strongly from the recession. But Labour's new plan drops another tax bombshell on our local economy- as if it wasn't bad enough that the local Labour party saddled us with the highest council tax rise in inner-London when they hijacked the council's budget process this year."

"The Government will be taking the final decision on this in the Autumn, so I'll be telling the Minister that Islington's businesses don't want a big tax hike from the Labour Party."

Islington's Liberal Democrat council has helped local businesses deal with the effects of the recession:

• An 'Open for Business' guide and website, a directory of local sources of advice that businesses can turn to.

• 'Business Turnaround': a tailored advice service for struggling businesses to adapt their businesses to survive the recession. This helped 15 businesses in its first two weeks.

• Free recruitment services to help businesses take on local people.

• 'Shop Local' campaigns and local businesses directories to encourage people to support their neighbourhood shops and services.

• Supporting and encouraging local businesses to compete for council procurement contracts.