Small businesses are so angry about the tax system that their willingness to comply with their legal obligations is in jeopardy, according to a group representing contractors and consultants.

The Professional Contractors Group called for an overhaul of the tax regime, which it said suffered from complexity, uncertainty and “sometimes strange and inconsistent tax outcomes”. It also attacked the retroactive impact of recent changes or proposals, such as the simplification of capital gains tax and rules designed to stop “income shifting” in family-run businesses.