Let's get on with business and get brexit done.
A Conservative majority government will implement a package of measures designed to help businesses across the South West make the most of Brexit.
The measures announced today, which will help thousands of the 561,600 businesses in the South West, include:
- A business rates cut. The burden of business rates will be reduced as part of a fundamental review.
- A jobs tax cut. National insurance contributions will be cut by £1,000 for over half a million employers. 169,000 businesses in the South West already benefit from Employment Allowance, and today’s announcement will mean another tax cut for half a million businesses across the country.
- A construction tax cut. Tax relief on the purchase, building or leasing of a structure will be increased by 1%.
- A research tax cut. We will review the scope of R&D tax credits and increase the rate by 1%.
Rishi Sunak, Chief Secretary to the Treasury, said:
“Under a Conservative government, the number of businesses in the South West has increased by 147,200 since 2010. Our announcement today will further unleash business potential across the region.
“A Conservative majority government will ensure that businesses can move forward with confidence. We will get Brexit done with the Prime Minister’s fantastic new deal so that we can move on with other priorities – like unleashing the huge potential of British business, supporting enterprise and improving skills.
“The alternative is an anti-business Corbyn-led government propped up by Nicola Sturgeon and the SNP and the chaos and uncertainty of another two referendums.”
Reducing the burden of business rates. Business rates are one of the top concerns of British businesses so a Conservative majority Government will launch a fundamental review at our first budget, consulting widely. We will reduce the overall burden of business rates as part of this review.
Raising the Employment Allowance from £3,000 to £4,000. Employers pay Class 1 National Insurance Contributions on their employees’ earnings. The Employment Allowance is currently claimed by over 1 million employers to reduce their employer NICs bills by up to £3,000. The next Conservative Government will increase the Employment Allowance to £4,000, which will provide a tax cut of up to £1,000 for more than half a million businesses. This will amount to almost a half a billion-pound tax cut for small businesses.
Increasing the Structures and Buildings Allowance from 2 per cent to 3 per cent. We will increase the SBA to 3 per cent to increase on the tax relief on the purchase, building or leasing of a structure, providing a significant boost to business investment. This is a permanent increase in the relief and firms of all sizes will benefit. Industries with a faster turnover of buildings such as in agriculture will benefit in particular.
Increasing the R&D tax credit rate from 12 per cent to 13 per cent. It is essential that we boost private sector research and development investment in order to raise productivity over the medium and long term. Around 7,000 claims for R&D credits were made under the Research and Development Expenditure Credit scheme in 2016/17. Raising the relief rate from 12 per cent to 13 per cent will boost manufacturing and professional, scientific and technical services sectors in particular. We will also review the scope of R&D tax credits to ensure they are fit for the future, including whether areas of investment such as cloud computing and data should be within scope.
A billion pound boost to business. The cumulative benefit to businesses of the changes to the Employment Allowance, SBA and R&D tax credits will be approximately £1 billion in 2022/23.