The Chancellor has delivered the first all Conservative budget since 1996 and seems to have provided a balance that seeks to eliminate the deficit but also maintain the stimulus to support a growing economy.
- 2.4% growth forecast for 2015 with 1 million extra jobs to be created by 2020
- National Insurance employment allowance for small firms to be increased by 50% to £3,000 from 2016
- Corporation tax to be cut to 19% in 2017 and 18% in 2020
- Annual investment allowance (AIA) set at a permanent figure of £200,000 from January 2016
- Introduction of a new national living wage for all workers aged over 25, starting at £7.20 an hour from April 2016 and set to reach £9 by 2020
Rises to NI employment allowance and certainty in the AIA will give SME’s the confidence to invest and has echoed our members calls for a stable tax regime that encourages long term planning and investment.
Reductions to corporation tax are welcomed, particularly by large business, and will attract investment but we would like to see a further rebalance so the tax businesses pay relate closer to profit and turnover rather than the input taxes businesses currently pay. We wait patiently for the report on the reform for business rates!
The Chamber would have also liked to see more focus on the skills required to fulfil the extra 1 million jobs. It’s vital for UK PLC that the system becomes more employer/demand led and creates the pool of talent necessary to sustain growth.
Of course we still need to see the devil in the detail of all the measures and the Chancellor has shown his commitment to helping businesses grow but we want to see precisely how this will enhance our roads and improve skills locally.