Small business insurance holders in the tourism industry could go bust unless the government maintains tax regulations on holiday properties, it has been claimed.
Research by the Federation of Small Businesses (FSB) found 80 per cent of tourism companies are worried that they will be forced to close unless tax rules stay the same.
Under the current system, furnished holiday lettings have to be available to rent for at least 20 weeks of the year and occupied for ten weeks to allow business insurance holders to receive a range of tax breaks.
However, the government has proposed changing the rules to class these business insurance holders as residential landlords, which would see them hit by extra tax bills.
John Wright, national chairman of the FSB, said: "Small firms know they are crucial to pulling the economy out of recession and on to the road to recovery, but they need the Government to create a tax-friendly environment to do so."
This month, the Northwest Regional Development Agency unveiled a £2.4 million investment in marketing to bring more visitors to the area.
