At a glance:
The good news:
- First ever UK infrastructure bank located in Leeds to finance green industrial revolution of up to £12bn
- New retail savings product to support green projects
- Help 2 grow schemes
- UK scientific superpower with a further 1.6 billion in funding for coronavirus vaccines and improved future preparedness
- 8 new free ports making it easier and cheaper to do businesses, unlocking private sector investment. The chancellor described these as “special economic zones to make it easier and cheaper to do business” with tax cuts and simpler planning rules. The locations are:
• East Midlands Airport
• Felixstowe and Harwich
• Humber
• Liverpool City Region
• Plymouth
• Solent
• Thames
• Teesside
Sharon Smith, Chief Executive of the Herefordshire & Worcestershire Chamber of Commerce said:
“This plan for a future post-coronavirus will give businesses a platform to be optimistic and lays the foundation for success and prosperity for the UK economy.”
The difficult news:
- Tax rises – corporation tax on company profits rising by 6% to 25% in 2023
- Income tax threshold freeze likely to mean working Britons pay more – with tax burden from 2025 highest since 1960s
- Sunak warns recovery will be slow but upgrades economic forecasts
- Public borrowing at war levels as debt to hit 97% of national income
Giving his reaction to the Chancellor’s budget, Dr Adam Marshall, Director General of the BCC, said:
“There’s much to welcome in this Budget for business communities across the UK. The Chancellor has listened and acted on our calls for immediate support to help struggling businesses reach the finish line of this gruelling marathon and to begin their recovery. Extensions to furlough, business rates relief and VAT reductions give firms a fighting chance not only to restart, but also to rebuild.
“We particularly welcome the massive ‘super deduction’ investment incentive that the Chancellor has put in place for the next two years. This responds directly to our call to encourage those businesses that can to invest and grow.
“While no business will relish paying higher rates of Corporation Tax in future, the impact of the Chancellor’s tough decision is blunted by the big new incentives for investment, lower rates for the smallest firms, and the extension of Coronavirus support measures in the short term.
“This Budget provides reassurance to businesses, provided that they are able to restart and rebuild according to the Government’s road map. If firms face unexpected bumps in the road, the Chancellor must be prepared to take action until the economy is firing on all cylinders again.”
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