§ Mr. Colvinasked the Secretary of State for Industry what definition he uses when describing "small firms"; and what relationship this definition has to the definitions of small firms used by the EEC countries, the United 445W States of America and Japan, as published in the Confederation of British Industry report on smaller firms in the economy.
§ Mr. David MitchellThe Committee of Inquiry on Small Firms (1971) concluded that a small firm could not be adequately defined in terms of employment or assets, turnover, output or any other arbitrary single quantity, and that the same definition would not be appropriate throughout the economy. This is a view the Government share and thus, rather than rely on a single definition, different definitions have been used to suit the circumstances of particular programmes. Lower rate corporation tax, for example, does not depend on a definition of a small firm but instead uses a level of taxable profit which is intended to be of particular benefit to small firms, while the small firms service employs the Bolton committee's definitions updated as necessary to take account of inflation. It will be apparent that this approach is different from those employed in the countries referred to in the Confederation of British Industry report on smaller firms.