Effortless computing

Robert Scoble in Davos rightly says that startups are the way out of the recession – they’ll be hiring long before large companies. 

I’ve posted and badgered politicians for months on this, even emailed Ken Clarke (does he use email?). There’s a quick and easy solution ready to be used: give small companies payment terms of 6 or 12 months on all their taxes. Yes, in the UK you get a long period on corporation tax, but not on the others unless you plead poverty to the Revenue.

The mechanism exists, it will have immediate effect, and won’t cost much. And no-one needs to persuade the bankers to start lending again.

Is anyone in our governments listening to small businesses?

Gordon Brown is trying to save our businesses again – but only if they’re debt junkies like him. His plan is still vague, but it seems to involve the government insuring or guaranteeing corporate debt. Which assumes a company has or needs significant debt…

But the service sector is dominant in the UK. Service companies don’t use much working capital and generally have little or no debt – but are suffering horribly in this recession. (Labour of course are still thinking in Capitalist terms.)

Give small – or all – companies another six months to pay their taxes (VAT, payroll, rates, etc) and you’d give them a huge working capital injection to help them through the bad times. It’s simple to implement, has immediate effect, and shouldn’t cost much in the long run.

As a bonus, it would make startups far easier to finance, boosting the UK’s entrepreneurial sector – which could help us out of the Brown mess.