§ 9. Mr. MorleyTo ask the Chancellor of the Exchequer what assistance he is providing to small companies for the collection and payment of value added tax.
§ Mrs. Gillian ShephardSmall businesses are able to take advantage of special facilities for dealing with VAT, including the cash and annual accounting schemes and particular schemes for retailers.
§ Mr. MorleyWhat help will the Minister give to well-established and respected firms such as Multiflex in my constituency, which is being surcharged £30,000 at the 25 per cent. rate as a consequence of the problems that it is experiencing in obtaining payments from its customers in the construction industry? The Minister will appreciate that such companies cannot lean on valued customers and that many of their problems have been created by the high interest rates that flow from Government policies. Given the poor state of the economic climate, should not the Government allow more flexibility and help rather than hinder small businesses?
§ Mrs. ShephardSome smaller firms dependent on bank borrowing are experiencing difficulties and I greatly regret that. I believe that the hon. Gentleman was referring to the serious misdeclaration penalty. The company that he mentioned can give reasonable excuse to satisfy Customs or the VAT tribunal and I advise the company to take that action.
§ Mr. BellinghamI add my congratulations to those already expressed to my hon. Friend on her excellent promotion. She will be aware, as she represents a neighbouring constituency to mine, that firms in west Norfolk are pleased about the recent increase in the VAT threshold. Does she agree that Customs and Excise must show the utmost sensitivity and understanding in erasing arrears incurred by small firms?
§ Mrs. ShephardI thank my hon. Friend for his kind welcome. The Government will continue to examine ways in which procedures can be simplified and we shall of course deal sympathetically with companies of the type that he described.