Spent time this afternoon trying to assess the Budget announcements …. And overall, our view at PRimage is: ‘not too bad, considering the circumstances’. The eye-catching Budget headlines are, of course, on fuel and corporation tax. Nice to finally see a little bit of light relief for the motorists of this country!
As the owner of a small business, Judy Viitanen was especially interested in the announcements relating to business – noted George Osborne signalling his desire to merge National Insurance and income tax. Osborne is ideologically a fiscal conservative, and this move paves the way for a low-tax future, by convincing Brits they pay too much tax!
Osborne also announced the Government’s Plan for Growth - http://www.hm-treasury.gov.uk/ukecon_growth_index.htm?dm_i=3QN,E7KN,K8LG6,14ROS,1 – a package of measures aimed at supporting private sector investment, enterprise and innovation. This includes measures to increase the competitiveness of the UK tax system; reduce the burden of regulation; and increase incentives for business investment.
Key measures in the Budget for businesses include:
- A reduction in the main rate of corporation tax by a further one per cent. From April 2011, the rate will be reduced to 26 per cent with further yearly reductions of one per cent until 2014 when it will reach 23 per cent;
- New Controlled Foreign Company rules to allow groups based in the UK to compete more effectively with those based overseas;
- The abolition of 43 tax reliefs whose rationale is no longer valid – following recommendations from the Office of Tax Simplification;
- Dropping existing proposals for specific regulations which would have cost business over £350m a year;
- £100m for local authorities to repair potholes caused by the cold winter weather;
- Increase the rate of R&D tax credits for small and medium-sized enterprises from 175 per cent to 225 per cent by April 2012;
- 21 new Enterprise Zones, to focus growth in specific parts of the UK;
- Fuel duty will be cut by one penny per litre from 6pm on March 23. The April 2011 inflation-only increase in fuel duty will be deferred to 1 January 2012; the April 2012 increase will be implemented on 1 August 2012;
- A further increase to the income tax personal allowance for under 65s of £630 to £8,105 in April 2012;
- Additional work experience placements and additional apprenticeships for young people;
- Help for homeowners facing difficulties by extending the temporary changes to the Support for Mortgage Interest Scheme for an additional year and providing £250m to support first time buyers to purchase a new-build property.