Darling defers tax increase for small firms

LONDON (Reuters) - Chancellor Alistair Darling said on Monday the government would defer a planned tax increase on small firms and offer a range of measures to support small business hit by the financial crisis.

Corporation tax for small firms was set to rise to 22 percent from April 2009 from 21 percent as part of a staged increase set out in the March 2007 budget.

"This will provide a boost to small companies, leaving their tax rate in 2009 unchanged," he told parliament. "I believe these steps will help businesses through the current difficulties and enable them to invest."

Darling also extended a system of tax repayments to help businesses which were previously profitable but now making losses.

He said the scheme would allow losses of up to 50,000 pounds to be offset against profits made in the last three years.

Darling said an estimated 75,000 businesses would benefit from this change.

For full coverage of Darling's pre-budget statement, click on: here