Supermarket Tax - Fair or Unfair?
Normally when the economy heads for trouble, the knee-jerk reaction is to "tinker" with interest rates. But with the ”time of Austerity” upon us, the Government is proposing draconian policies some of which will affect the Construction industry indirectly.
Past ill-thought out policies have caused devastation to the construction industry felt for years after and in my view explains many of the industries recurring headline problems.
- Lack of long term investment and work pipeline - this leads to unrealistic rates in tenders as the volume of work fluctuates between famine and feast.
- Lack of partnering - how can you build successful teams when you are never sure of the future?
- The VAT issue - most sensible people consider the removal or reduction of VAT for domestic repair, maintenance and upgrade projects as a simple way to stamp out the illegal "cash-brigade" and rid the industry of the cowboys.
- Dispute culture - the uncertainty creates the perfect climate for senior supply chain members to bully juniors. Lack of cash = disputes.
The recent policy proposal to apply a super-tax to supermarkets is no better. There is no doubt that supermarkets make money. Is that a crime though and should it be a reason to simply hit them with a super-tax? Latest update is that the “super-tax” could itself be illegal!
Should this ridiculously unfair tax be passed, the construction industry will suffer again. Retailers will inevitably reduce capital expenditure and their expansion plans which, ironically, will stifle the economy as the many jobs that they provide are lost.
The fact of the matter is that unless the government listens to what the construction industry has to say, every contractor must take their fate into their own hands.
It’s never been more important to examine every aspect of your operations and look at how they can be improved.
From business development through tendering and cost control, project management and staff, valuations and credit control.
Rate each aspect on a scale of 1 to 10. Then look at how you can improve each area- even if it’s only by a small amount.
