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Richard Lambert, director general, CBI
'This is superficially quite clever, and on the surface might seem like a relief after three months of uncertainty.
'But even the smallest business owner will lose taper relief and indexation and be worse off than before October.
"The reality is that these revised measures will do nothing to help the real business powerhouses of this country.
'Although £1 million might sound a lot, it could have been built up over twenty or thirty years.
'It is clear that the real wealth and job creators of the UK's economy, selling assets for a lot more, will be seriously clobbered.'
Matthew Goodman, policy representative, Forum of Private Business
'We accept that these changes will address most of the concerns of our members.
'However, the Chancellor has not resolved the issue of historic indexation. Steps must be taken to ensure that long-running businesses aren't devastated by taxing them on inflation as well as their success.
'Disguising this oversight as simplification does no justice to the Government's legitimate simplification agenda.'
Miles Templeman, director general, Institute of Directors
'The Government has listened to some of our concerns, and the new relief will benefit many small businesses.
'Of course we welcome that, but there will still be a very large tax hit on business overall.
'The lifetime limit will be a constraint on serial entrepreneurs. The distinction between business and non-business assets will retain an element of complexity.
'And the fact that there will be no fully exempt gain means that complicated calculations will still be needed in all cases.
'Furthermore, the relief will be significantly less generous than the old retirement relief, when we take into account the loss of indexation allowance and inflation since 1998.'
Mark Baldwin, partner, Macfarlanes
'[Entrepreneurs'] relief appears to be targeted more at owner-managed businesses and would, for example, be of little assistance on a buyout where managers would not generally expect to own as much as 5% of a company's equity.'
Mike Dawes, tax partner, TWP
'Certainty is fundamental to an efficient taxation system, and the Chancellor's dithering has not been helpful.
'This belated Christmas present is welcome news for small entrepreneurs who may need up to a couple of years to sell their businesses.
'It will be important to see the details; for example, will crystallised deferred gains on redemption of QCBs be taxed at the lower rate?'
David Young, head of the tax panel, UK200Group
'This is a knee-jerk patchwork solution to a blindingly obvious problem that should have been thought through before the proposals were tabled.
'Perhaps our terminally-ill tax code could be given a life saving drip if occasionally the Treasury spoke to tax professionals both inside and outside HMRC before it tabled a proposalm rather than afterwards.'
Francesca Lagerberg, head of national tax, Grant Thornton
'The [announcement] will have calmed a lot of nerves, but there are many that now face the prospect of hurrying through a sale of assets in a matter of weeks to take advantage of taper relief and the indexation allowance before it disappears for ever.
'Tax simplification is a very attractive but radical idea, so needs time to let people and the Treasury untangle the complexities in the UK tax system and ease business owners into the new regime and plan ahead.
'With public finances stretched paper thin, I'm not sure where [Alistair Darling will] find an additional £200 million to plug the hole come the Budget in March.'
Peter Harrup, tax partner, PKF
'The announcement is a neat short-term political move, which will satisfy some SME owners who have felt under pressure to sell up before April to avoid losing taper relief.
'From that perspective, it is obviously welcome.
'But rather than simplify the system, the Chancellor is introducing new layers of complexity. I expect HMRCto add to the new rules.
'In future years we can look forward to an endless array of new rules to try to shut off all the loopholes that they haven't even begun to think of yet.
'It really looks like change for the sake of change.
'Given that it's a lifetime limit, the £80,000 tax reduction isn't much of an incentive to be entrepreneurial. Most serial entrepreneurs will probably ignore its minor impact on their plans.'
Chas Roy-Chowdhury, head of taxation, ACCA
'It has been a hard slog to win the government round on this issue and they have taken their time in coming to a decision that is more palatable for the UK's SME sector.
'The lesson for the future is for Government to consult with interested parties before making such drastic changes, rather than having to go through a retrospective process that frustrates and engenders lack of trust.”
'There is one note of caution: businesses which make more capital gains than £1 million may not find the concessions so palatable. But we hope the new arrangements will make for a more stable and certain future for small business.'
Tony Cohen, head of entrepreneurial business, Deloitte
"The Chancellor's announcement shows a turnaround by government, no doubt bowing to pressure from business leaders, and eroding by some 20% his planned tax take from the changes proposed in October.
'However, the turnaround is limited... so may not in practice benefit serial entrepreneurs.
'Large-scale entrepreneurs will still suffer the 18% rate on gains once they have used their £1,000,000 limit. If they want to take advantage of the old 10% rate, they will need to either sell their company prior to 5 April 2008, which is a very short time scale, or enter into complex tax planning.
'Again, the time scale for this is short and will no doubt give rise to a further spate of anti avoidance legislation.'
Kevin Nicholson, UK head of entrepreneurs and private companies, PwC
“We will always welcome moves to create simplicity in the tax system. But this needs to go hand-in-hand with providing certainty to taxpayers and being willing to listen to those affected.
'Frequently tweaking the UK tax system - as has been evident with the CGT system - only adds to complexity.
'If the Government is committed to simplifying the UK tax system, it must work with business to implement a long term strategic tax policy framework.
'Business will then have more confidence to plan ahead and in turn be more welcoming to future, planned changes to the tax system. Without this, the UK will struggle to achieve its potential as a true enterprise economy.'
Liberal Democrat shadow chancellor Vince Cable
'The Chancellor's climb-down on capital gains tax reform was inevitable and is a stark demonstration of the pitfalls of making up tax policy over a weekend.
'The truth is that CGT does need reform, but it must be done through full and open consultation with business, not written on the back of a fag packet in a bid to pull together a snap election manifesto.'
Rob Ellerby, CIOT President
'If there is one lesson to come out of the CGT saga, it is the importance of consultation with those affected. In taxation, the only time that change should come before consultation is in the dictionary.'
George Bull, head of tax, Baker Tilly's
'There will still be losers. Full-time working employees of trading companies who — perhaps through share incentive arrangements — own less than 5% of their company's shares will not qualify for the new relief.
'As they currently qualify for taper relief, they will be significantly worse off under the new regime, paying tax at 18% on all their gains.
'For very large publicly quoted companies, this will also catch the share dealings of directors and employees whose holdings in the company may be very valuable, but are unlikely to exceed 5%.
'This may be a covert attempt by the Treasury to tackle generous share incentive plans for company directors.'
Fiona Downes, head of employee share ownership, ifs ProShare
'Having informed the Chancellor of the fact more than 270,000 employees could be worse off following his proposals, we are naturally disappointed that this evidence appears to have been ignored.
'As well as there being no changes to mitigate the effects on employee shareholders, the uncertainty and repeated delays in confirming this decision mean many employee shareholders will have to make relatively quick decisions about whether or not to sell or hold some of their shares.
'Employers will also face a real challenge in communicating these implications to their employees within a very short period of time.'
