Political decisions affect businesses of all sizes, as the laws and regulations set will have a direct impact on their day-to-day practice. A change in government can overnight, change the environment for businesses. A new government will often change the taxation on businesses, as well as other factors such as grants and spending. There are different levels of government that influence businesses.
The European Union – The UK is a member of the EU and is affected by the decisions made on subjects such as International trade.

Political stability – In the UK, Once a government has been elected, businesses can look forward to years of stability in terms of policies and targets as outlined in the government’s manifesto. This allows businesses to plan for the future and if necessary, change their products.

Government support: Government try to provide a fair marketplace in which all firms can compete. They may do this by investigating mergers and takeovers or removing barriers to entry, for example by helping with the start-up costs. They may also offer grants. Voluntary organisations can receive grants, for example, from the National Lottery. They are often also given relief on assets such as property. In the voluntary sector, the government will often part-fund projects, especially if they benefit society.

Infrastructure: Government also play a major role in providing the infrastructure of an area. Internet access, roads and other transports links allow business to grow. Without government pressure to expand the internet in the UK, most businesses would be without an internet connection. Access to motorway allows businesses to visit