The not-for-profit small business support group, headquartered in Cheshire, polled its members to record attitudes on coalition-implemented tax changes as it reaches the mid-point of its five-year term of office.
Overall, the changes were seen to be negative in terms of resolving issues around fairness, simplicity, efficiency, stability and certainty in the tax system.
In total 28% of business owners said they thought the fairness of the tax system had deteriorated, compared to 17% reporting an improvement. A quarter thought it had become more complex, opposed to 14% saying it has simplified. And dealing a blow to HMRC, 26% said the efficiency of the tax system had got worse. Just 10% thought it had improved.
This latter point raises concerns about how HMRC will cope with Real Time Information (RTI) when it comes into being in April. So far, pilots of RTI have picked up very few problems and the Forum of Private Business has been working hard with HMRC to promote the changes to its members. Nevertheless, this research does highlight a fear among businesses of how the government department will administer this huge change.
The research also showed the single biggest complaint small firms had regarding their current tax spending was business rates. A huge 94% of all business owners felt that the level of taxation on commercial properties was now too high. Two thirds of those also said they saw no real benefits for the amount of money they were spending on the tax.
A similar number reported that there were few local initiatives to support growth, with some feeling that local councils were actually hampering growth.
Just 3% of respondents saw no problems with business rates.
"It's probably fair to say that business rates are the most despised of all commercial taxes by today's small business owner in the UK," said the Forum's Chief Executive, Phil Orford.
"It's a crippling tax that business owners simply have no choice but to pay, and for many who claim to see no discernible benefit to having paid up, it clearly sticks in their craw.
He continued: "While there's no doubt that businesses should pay their way for services such as bin collections and for roads to be properly maintained, many feel their hard earned cash is not being spent wisely, or certainly not for their advantage or benefit. It's evident that business rates are increasingly being viewed as a crude lever to extract cash from hard working entrepreneurs, much of which they'll never see again. We tend to agree.
He added: "This research shows George Osborne really has to consider – and seriously – making a credible concession to small business in the Budget on this moot point. Businesses are clearly unhappy about the spiralling costs of NDR, and we think the tipping point is about to arrive, if it hasn't already.
"If rates keep charging upwards then businesses are going to go bust – it's as simple as that."
The majority of small businesses in the UK have taken a dim view of changes made to the tax system by the current government, research by the Forum of Private Business shows.