As the autumn budget looms, tax incentives and improved access to finance have emerged as key demands from UK SMEs, according to new research from Bibby Financial Services (BFS).

The latest SME Confidence Tracker reveals that while business optimism has rebounded post-election, small business leaders are calling on the government to address critical financial barriers to unlock growth.

The survey of 1,000 SMEs found that 68% expect sales to increase over the next six months, a 7% rise since March 2024. With stabilising inflation and lower interest rates, 63% of SME leaders now feel more confident about making capital investments, while 52% are more likely to pursue major investments following the General Election.

However, concerns persist about the potential for tax hikes in the upcoming budget, with 87% of respondents calling for better tax incentives, and 81% advocating for access to low-interest financing to support expansion and job creation.

Derek Ryan, UK Managing Director of BFS, urged the government to honour its commitment to small businesses, saying: “SMEs are finally feeling confident enough to invest, but the Prime Minister’s warning of a ‘painful’ budget risks undermining this. Supporting SMEs must remain central to the government’s economic growth plan.”

Access to finance remains a significant challenge, with 49% of SMEs describing the finance landscape as complex, and 80% seeking better educational resources for navigating funding options. While commercial finance approvals have risen, many SMEs still find the process daunting, with only 18% having utilised the Bank Referral Scheme.

The Labour Party’s proposals to improve SME financing through reforms to the British Business Bank and the Bank Referral Scheme are seen as promising, but experts like Sandeep Dhillon, CEO of SME marketplace Talmix, stress the need for immediate clarity on tax policies and financial support, particularly for the tech sector, where investment has waned.

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Tax incentives and finance access top SMEs’ priorities ahead of autumn budget