Lower VAT threshold would hurt SME output
The FSB has warned that lowering the VAT threshold would hit business output, by forcing small firms to take on a greater administrative burden. The FSB found that for 43% of firms, calculating the amount of VAT owed is the most time-consuming part of complying with the system. A report by the OTS estimates that cutting the threshold to £25,000 could yield up to £2bn in extra VAT receipts, but would drag 1.5m small traders into the system.
Source: Daily Mail (18/11/2017)