The Chancellor's proposals to support small businesses, unveiled in the Pre-Budget Report, have drawn a mixed response.

Business owners have welcomed measures to allow struggling companies to spread tax payments and to delay a 1 per cent rise in corporation tax - planned for businesses that make less than £300,000 - until 2011.

Mr Darling also announced the creation of a Small Business Finance Scheme to guarantee bank lending of up to £1 billion, with the aim of giving the banks more confidence to lend. The Chancellor also had good news for developers. Empty commercial properties with rents of less than £15,000 will be exempt from business rates.

However, not all the measures were welcomed by entrepreneurs, especially the 0.5 per cent rise in employer national insurance that will be levied in 2011.

Matt Ellis, of Deloitte, the accountant, says: “This will cost employers an additional £2 billion.”

Independent shopkeepers have also reacted with dismay to the temporary reduction in VAT to 15 per cent. Many have complained about the huge cost of repricing goods and updating computer systems at the busiest time of the year. There will be further costs when VAT returns to 17.5 per cent on January 1, 2010.

Henry Ejdelbaum, of AIMS, a national association of accountants, says: “We all welcome a ‘fiscal stimulus' package to ensure that the recession is shorter and shallower than predicted, but this package has served to create extra work and an administrative nightmare just before Christmas and the January tax deadline.”