The Chancellor’s key business announcements include the following:
- Corporation tax to be reduced by 2% in April 2011 rather than 1% as previously planned, promoting high levels of business investment and helping the UK maintain the lowest rate in the G7. By 2014, the rate will be reduced to 23%.
- No new regulation on firms with fewer than 10 staff for three years.
- 43 different tax reliefs to be abolished as part of simplification of tax code.
- Introduce a moratorium exempting micro-businesses and start-ups from new domestic regulations for three years from 1 April 2011.
- Reducing the burden of regulation for businesses, including dropping proposals for specific regulations which would have cost business over £350 million a year.
- New rules to require planners to prioritise growth and jobs.
- Continued commitment to the Green Investment Bank (GIB), including an initial capitalisation of £3 billion and it becoming operational in 2012-13, a year earlier than previously expected.
- Reform of the Enterprise Investment Scheme (EIS) and Venture Capital Trusts, including raising the rate of EIS income tax relief to 30% from April 2011, subject to State Aid approval.
- Business rate relief holiday for small firms extended for another year from 1 October 2011.
- Doubling the lifetime limit for Entrepreneurs Relief to £10 million.
- Increasing the SME rate of R&D tax credit to 200% from April 2011 and 225% from April 2012.
- 21 ‘Enterprise Zones’ to be created across England, with simplified planning rules, superfast broadband and tax breaks for businesses.
- Implementing the proposals of Lord Young’s review of Health and Safety.
- Consultation in 2011 on the options for integrating the operation of income tax and National Insurance Contributions (NICs).
- £180 million package for 50,000 additional apprenticeships, and an additional 80,000 work placements for young people.Launch of a public thematic review to reduce the stock of regulation.
- On 24 March 2011, the Government will publish a consultation paper on rebalancing the Northern Ireland economy, including looking at mechanisms for devolving the rate of corporation tax to Northern Ireland.
Alongside the Budget, the Coalition Government also published The Plan for Growth outlining a package of four over-arching measures to support private sector investment, enterprise and innovation in order to create the right conditions for private sector-led recovery and sustainable economic growth. For more information from our business advice team please follow the link.