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AIC responds to HM Treasury VCT consultation.

The Association of Investment Companies (AIC) has responded to HM Treasury’s review of the VCT scheme rules.

The AIC proposes allowing individual VCTs to invest greater amounts in individual SMEs and this would be achieved by removing the annual £1million investment limit.  This reform would benefit both individual VCTs and the companies they invest in by reducing due diligence costs and creating a simpler way of meeting the funding need of businesses seeking development capital.  

The AIC supports the Government’s desire to ensure that VCT investment is properly focused on risk capital.  Its proposals seek to deliver rule changes which are proportionate and do not inappropriately reduce investment opportunities available to the sector.

Ian Sayers (pictured), Director General, AIC, says: “The Government’s desire to liberalise the VCT scheme is extremely welcome. We also fully support its desire to see VCT and Enterprise Investment Scheme capital properly focussed on businesses which most need support.  This agenda has never been more important given the challenging trading environment facing the UK’s small business sector.

“Our recommendations will deliver both greater investment freedom and an enhanced focus.  Just as importantly they will also ensure that VCTs can continue to offer an attractive investment proposition for the retail market. We look forward to continuing to work with the Government and hope these changes can be made in next year’s Finance Bill.

 

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