With around 15% of AIM liquidity coming from IHT fund solutions, Dominic Tayler, UK Managing Director at Oakglen Wealth, warns on the potential impact of removing AIM business relief in the upcoming Budget:
“In recent years the Alternative Investment Market (AIM) has been hit with liquidity eroding as investors switch to passives and pension funds ignore the smaller end of the market. Speculation around the removal of business relief for AIM in the forthcoming Budget has compounded this. Not only is this bad for business, it also harms long-term savers who are the life blood of private investment.
“The UK has an ageing population and pensioners own a significant proportion of the market. 15% is held through business relief-based funds for inheritance tax purposes and any adverse policy change in the area is likely to result in further AIM decline. The result would be talent exodus and less investment in UK plc, precisely the opposite of this Government’s manifesto. Growth is the only way to create lasting change and the means to support government expenditure.
“If business relief goes this does not just impact those who can afford to invest but everyone else associated with small companies within the private sector, which cannot rely on private equity funds or government grants. Often the companies that are ignored by many are precisely those which investors should be incentivised to support. Quality, cash-generative businesses exist on AIM and deserve to be supported. Real workers’ jobs will be affected if this relief goes.”
