IT chiefs lobby for tax breaks in UK budget

UK technology experts have spoken to Silicon.com about their Budget '99 wish list as Chancellor Gordon Brown prepares to present his speech in the House of Commons later this afternoon.

Tax relief for investment in R&D (research and development) features heavily on the list, with share options following a close second.

Robin Bloor, chairman of Bloor Research, claimed tax relief was especially relevant to small and medium-sized enterprises (SMEs) and start-ups. "SMEs' real issue is money for growth, and any sort of assistance for those people would be greatly received so clearly company taxes need to be dropped for them," he said.

Ian Ritchie, president of the British Computer Society agreed. "Innovation in the economy comes from start-ups. If we don't have start-ups, we'll just be customers of these US multinationals," he explained.

Bloor also stressed the need for tax exemption in R&D so companies expand via the Internet and the use of electronic commerce. He said: "They need help to expand their business. The reason US companies do so well is that they have an instant domestic market of 250 million people, here there are 50 million. The Web does something about this - the Internet is a tool for growth for them and the government need to do something to enable enterprise to use it."

Mike Kerford-Byrnes, UK general manager of enterprise application firm Millennial III, claimed the government would win points by offering tax free share options or tax relief for ecommerce. "There's needs to be a general improvement in the way government encourages ecommerce," he said. "They are right in thinking that it is important for the future, but need to offer more tax incentives to encourage it."