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A full consultation on the future for the taxation of SMEs would be more welcome in the Budget than tax 'giveaways', PKF has stated.
The company has warned that businesses will be 'facing the financial equivalent of gridlock' if the Chancellor announces tax breaks and does not 'keep them simple'.
PKF's national director of tax, Lisa Macpherson, pointed out that there are likely to be some Budget incentives for SMEs and entrepreneurs following the creation of entrepreneurs' relief.
However, she argued that the complexity of the tax system means that tax breaks for small business usually come laden with caveats and bureaucracy, making them sometimes 'more trouble than they're worth'.
'The tax position for small business has evolved to the point where it is now hugely complex and in danger of becoming incomprehensible, sometimes even to HM Revenue & Customs and the accountancy profession,' claimed Ms Macpherson.
'The Government could shut down tax loop holes far more effectively by simplifying the whole system and creating a level playing field between businesses, sole traders and partnerships, rather than adding more regulations and red tape as they seek to shut down practices they regard as evasion.'
She concluded: 'It's time for a complete overhaul, but only after full consultation with the business community and its advisers, which should take a minimum of two years from its beginning to the introduction of legislation, with a minimum period of six months devoted to dealing with any issues raised once draft legislation has been made public'.
