The UK government yesterday bowed to business pressure when it watered down earlier proposals to reform capital gains tax, writes Jean Eaglesham . Small business owners will get an "entrepreneurs' relief" CGT rate of 10 per cent on lifetime gains of up to £1m (€1.3m).

The concession follows intense lobbying against an earlier decision to impose a flat CGT rate of 18 per cent - a move that hurt relations between government and business.