Small businesses were singled out for special treatment in the Budget as Finance Minister Paula Cox described how inspired she was by the entrepreneurial spirit of Bermudians.

In her Age of Empowerment Budget, Ms Cox outlined a raft of measures aimed at assisting small and medium sized businesses.

Ms Cox said she had met with many business owners many of the discussions had centred on the costs of doing business in Bermuda and the particular pressures that are faced in different business activities.

As a result, Government will introduce amendments to the Payroll Tax Rates Act 1995 and the Customs Tariff Act 1970.

?Some proposed changes in payroll tax, customs duties and stamp duties will have the effect of reducing the tax burden in certain sectors of our economy,? she said.

The Minister said the proposed amendments will have the effect of stimulating new start-up businesses and assisting existing small businesses in managing and containing costs during their early years of development.

A tiered structure will be introduced in the payroll tax to provide incremental steps toward the maximum rate of 13.5 per cent. The proposed changes focus particularly on small and medium-sized businesses.

The changes proposed for the Customs Tariff Act 1970 will introduce reduced rates of duty for florists and provide concessions to registered farmers.

?With respect to the payroll tax, the standard rate of 13.5 per cent will remain as is in 2005/06. A new tiered rate structure will be introduced for small to medium-sized businesses on the basis of their payrolls.?

Training and employment will be stimulated by exempting persons on bona fide training programmes approved by the National Training Board from payroll tax.

?This should be a boon for small and medium sized businesses and attractive to other businesses as well.?

Following consultations with farmers, fishermen and some other small to medium-sized businesses, Government will also amend certain tariff items to assist businesses to remove apparent inconsistencies in tariff rates between broadly similar categories of goods.

?Currently there is provision in the Customs Tariff for businesses to bring in samples of goods duty free. However, the provision is not that widely used by small businesses because guidelines about what constitutes negligible value have not been updated in recent times.?

?Government proposes to amend CPC 4314 so that it is of greater use to small businesses in their promotional and marketing strategies.?

In order to help promote local agricultural and horticultural industries and to encourage the ?greening? of Bermuda, there are proposals to introduce duty concessions for farmers.

The Customs Tariff Act 1970 will be amended to provide a zero rate of duty on all equipment supplies and machinery imported by registered farmers.

The Minister of Finance and Ministry officials met with representatives of the floral industry, and during that meeting local florists were persuasive in asserting that there was no logical reason for the existence of a differential rate of duty between cut flowers and greenery.

The Ministry of Finance was in agreement so the Government will amend the tariff by reducing the rate on fresh greenery to 22.25 per cent with effect from April 1, 2005.?

Government proposes also to align the tariff rate levied on the raw form of PVC with the rate applied to finished PVC goods such as window shutters.

The existing differential rate places local industry at a disadvantage as a higher rate of duty ? 22.25 per cent ? is paid on PVC in its raw form which is used to produce finished PVC products in Bermuda. After the amendment, the tariff rate on the raw form of PVC will be 10 per cent, the same as applies to imported doors and shutters made of PVC.