Sir, Chancellor Alistair Darling’s pre-Budget report is nothing more than an ill-conceived headline grabber.

His statement that it was a ‘deliberate decision to support people and businesses through these difficult times’, when considered in relation to his cut in VAT, demonstrates that the government has not thought this through.

We would all welcome a ‘fiscal stimulus’ package to ensure that the recession is shorter and shallower than predicted but what this package has created is extra work and an administrative nightmare for small businesses just before Christmas and ahead of the 31 January tax deadline.

Take, for example, any small VAT-registered retailer who takes his responsibilities seriously and tries to pass on the full impact of the reduction in VAT. He has until Monday morning to recalculate all his prices, relabel stock, adjust his till, amend his website and organise reprinting of his catalogue.

He will have to decide what to do with mail-order purchases in the pipeline and it is probably too late for him to change his advertising.

He probably won’t see any change in business levels – if you don’t want to spend £117.50, is a reduction to £115 going to change your mind?

When he finally gets to sit down he realises that he has to adjust his accounting system, which will probably total £500-£1,000 of unpaid labour.

Henry Edjelbaum, AIMS Accountants for Business

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