Value added tax (VAT) registrations and de-registrations are currently the best guide to the pattern of business start-ups and closures. DTI data on the number of VAT registrations, and the start of year stock of VAT registered businesses in the north-west from 1997 to 2005 are shown in the following table. Data for 2006 will be available autumn 2007.
1997 1998 1999 2000 2001 2002 2003 2004 2005 2006 Registrations 17,700 17,545 16,875 17,155 16,485 17,385 19,005 18,080 17,500 n/a Stock 159,055 161,155 163,125 164,645 165,945 166,925 168,095 171,145 173,575 176,805 Source: Business Start-ups and Closures: VAT Registrations and De-registrations 1994-2005, Small Business Service, available at: http://www.dtistats.net/smes/vat/index.htm
Although numbers of registrations in the north-west have remained fairly constant, the start of year stock has risen by 11 per cent. over the period.
VAT registration and de-registration data do not capture all business activity. Businesses are unlikely to be registered if their turnover falls below the compulsory VAT threshold, which has risen in each year since 1997. Similarly, businesses that de-register may not have closed. Only 1.8 million out of 4.3 million businesses (42 per cent.) were registered for VAT at the start of 2005.