The second reason works even more directly against business starters, regardless of whether or not they take VC or angel funding, as they would face the same tax rate if they sold their business as if they were earning an income from an employer. In other words, it gives potential business starters far less incentive to risk leaving a career in the hope they'll make a million doing it for themselves.
There are shades of grey here, as 'non-business assets' is a debateable term. George Osborne has said he will use it to refer to assets like pensions and second homes rather than start-ups - but the business world is rightly very concerned that that differentiation simply won't transpire when the new CGT rate kicks in.
Lord Sugar summed it up during a debate on small business policy at the House of Commons thus: "[Raising CGT] will have a devastating effect on enterprising people's desire to take the lead and set up their own business with a view of either floating them or selling them by way of a trade sale."
He laid into the entrepreneurial relief currently in place too, that means you only get taxed 10% on the first £2m of capital gains, implying it was rather token in most cases. "In this day and age this amount falls short of the aspirations of real growth companies, especially those in the technology sector."
Sugar said the 'big payout' from selling a business was the main goal of entrepreneurs and their employees. "Most devastated will be those business or asset owners who have worked honestly and hard all their lives and are reaching an age where they are considering a sale."
He's not alone in his anger. According to research by the British Chambers of Commerce, half the UK's businesses oppose the increase. Among countless entrepreneurs on Twitter and in the news, big-hitting opponents include the British Chambers of Commerce, the London financial newspaper City AM (which has waged a campaign against the CGT increase), The Telegraph (which launched a petition against it, and members of the high-profile entrepreneurial group The Supper Club (93 of whom signed a letter to the chancellor explaining their disagreement earlier this month).
And yet this new government has repeatedly said it's pro-small business, pro-enterprise. So you might justifiably wonder what the [insert swear word of your choice] George Osborne actually thinks he is playing at. Well, David Cameron says CGT 'tax avoidance' costs the economy £1bn a year.
But the thing is, raising CGT has actually been proven to hurt economies, as this article neatly proves.
There is a glimmer of solace at the end of this murky tunnel. Rumours trickling out of the Houses of Commons suggest all these bellows of dissent have dissuaded Osborne from making the increases quite so aggressive.
But we'll just have to wait until Tuesday to see if Osborne has really listened to the entrepreneurs of this country.
We'll be covering the Budget live this Tuesday from 12:30 pm. Find otu more and set a reminder here.