Removal of tax cliff `a blessing' Gov't capital project spending of $148 million will be `a bonanza' to contractors $1.3 million National Training Board budget will help educate New Customs automated processing will speed clearance of goods The 2000 Budget presents a number of opportunities for small businesses, Bermuda Small Business Development Corporation general manager William Spriggs said yesterday.

Small businesses have been booming here for some time now and the sector has just been strengthened with Government's offering last Friday, he said.

Mr. Spriggs said the changes proposed for payroll tax were a reward for the past few years of lobbying the Finance Ministry by the Corporation and entrepreneurs who viewed the old system as a disincentive for small business start-ups.

"Many, if not all small businesses will view the removal of the `tax cliff' as a blessing,'' he said.

Government moved to smooth out the `tax cliff' facing small businesses moving from the $100,000 payroll band to the $200,000 payroll band by only charging them the higher 9.25 percent rate on the actual amount of payroll exceeding the $100,000 mark instead of their whole payroll.

Mr. Spriggs added that now was the time for small businesses to review their operations and make the necessary changes to ensure long-term success and profitability.

"Taking into account the new pension legislation step costs -- one percent and increasing -- and the likelihood of payroll tax and social insurance arrears with many seasoned small entrepreneurs, now is the time to tidy up and restructure towards becoming mean and lean,'' he said.

He said small businesses should ask themselves if they could continue to strive if the next Budget was not as successful. Government's plans for a capital project spending bonanza worth $148 million presented significant opportunities over the next few years for small trade businesses in particular, noted Mr. Spriggs.

Budget a boon "This $148 million, combined with the top three Government current account expenditure 2000/2001 Budgets of Education ($69 million), Hospitals ($64 million) and Works & Engineering ($43 million), all of which do a fair amount of outsourcing, represent a treasure trove of opportunities for the small trade and service entrepreneur,'' he said.

Mr. Spriggs offered advice to small businesses who wanted to go after these Government contracts.

"Professionalism, contract savvy and good pricing skills are key in dealing with Government, not to mention a truckload of follow up,'' he said.

And he invited them to call the Corporation for assistance in bidding for them.

"Our knowledge of any small business proposal in response to any Government tender is much appreciated, as this information will be used for database purposes, with the end goal of creating more opportunities for the small business entrepreneur.'' Turning to the National Training Board's $1.3 million budget, Mr. Spriggs said "it appears to be small but packs a big bang for its buck''.

He pointed out that while many entrepreneurs did not know why the Board existed, it was looking to fund training initiatives on Island, including those of small businesses.

Small businesses could take advantage of the Board and take on an apprentice or train employees in skills they need for the future.

On international business, Mr. Spriggs pointed to Finance Minister Eugene Cox's statement that "it is abundantly clear that the economic well being of Bermudians is linked to the economic health of the international business sector''.

He stressed that the Corporation would continue to partner with key Government departments in a bid to forge alliances with international businesses.

And he said the Corporation was actively looking to meet with small entrepreneurs who were interested in pursuing business in the international sector.

"We have a number of strategies in place to gain a deeper understanding of their business needs, with a view of creating more profitable opportunities for small businesses,'' he said.

Mr. Spriggs praised Government's announcement that it would be moving to zero-based budgeting and backed the Customs Automated Processing System which would reduce entrepreneurs' time performing non-value added work in the form of clearing goods and the associated paperwork.

BUDGET REACTION Thumbs up: Bermuda Small Business Development Corporation general manager William Spriggs says the Budget will have a positive impact on small businesses.

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