Government urged to increase EIS tax relief to boost SMEs

The government is being urged to increase relief on income tax for investors in enterprise investment schemes (EIS), to help support small businesses through the coronavirus crisis.

Such a move would be a boost to any companies raising money that are eligible for EIS investment, including peer-to-peer lender Crowd2Fund.

The EIS Association wrote to the government last week to ask for the relief to be extended from the current 30 per cent to 60 per cent.

Read more: Crowd2Fund gets EIS approval

Now a petition to chief secretary to the Treasury Stephen Barclay is asking for the relief to be increased to 80 per cent.

Investment advisory business Vala Capital has launched a petition on the Change.org website.

Read more: P2P platforms vow to help SMEs amid coronavirus concerns

“Small innovative businesses are in freefall – the government needs to act fast,” it said.

“Please support this petition calling on the government to increase tax relief for small company investors and hand start ups a lifeline during the coronavirus crisis.

“Private investors could inject cash into these businesses if supported by temporary increased tax relief.

“Innovative small businesses are so important to a recovery from coronavirus, they provide jobs and the means for future economic stability.

“If adopted this initiative could see up to £1bn committed to thousands of small companies that have no other support available to them.”

The petition had more than 500 signatures as of Monday morning (23 March).

Read more: How are P2P lenders responding to the coronavirus pandemic