#venture-capital-trusts

#venture-capital-trusts

The lack of appetite for UK smaller companies and an "on-again, off-again" approach to tax reform has been a toxic combination for AIM. Hargeave Hale, like most AIM VCTs, hasn't escaped the damage, losing investors 39.5% over five years. The big question for VCT investors though is not what's gone before, but what the future holds. The decline in AIM valuations has left the VCT with an exceptionally well diversified, and by VCT standards remarkably low risk, portfolio.

The government urgently needs to reconsider these changes. Our analysis shows that start-up and scale-up businesses could face a funding shortfall of well over £500 million, as a direct result of changes to VCT tax relief announced in the Budget. If the aim, as was claimed in the Budget, is to make Britain the best place to start and scale a business, this misguided policy risks achieving the opposite.