Chancellor announces measures to help business
Photo credit HM Treasury’s Flickr stream
In his budget today, the Chancellor, Alistair Darling, unveiled a package of measures designed to help small businesses.
Business rates will be cut for one year from October, which Mr Darling said would be a reduction in payments for more than half a million small businesses. 345,000 will pay no business rates at all.
The Annual Investment Allowance will be doubled, to £100,000. The Chancellor said that this would help small businesses expand, by allowing them to deduct all plant expenses from profits in the first year. However, the Institute of Directors said that the majority of firms would see no benefit from this, “because their investment is smaller than the old £50,000 limit”.
There are new measures to try to expand credit lines available to business. RBS and Lloyds will provide £94bn of new business loans, nearly half to smaller companies. There will be a new credit adjudicator to look into cases where small business owners feel they have unfairly been denied credit.
A new initiative called UK Finance for Growth will oversee £4bn in government aid for business. An additional 15% of government contracts will be awarded to SMEs, which could mean an addition £15bn of new business across the whole of the public sector.
The CBI called the Budget “a series of modest but helpful changes”.
Sadly for many, there was no backtrack on the government’s plan to increase to employer National Insurance contributions, which the Federation of Small Businesses has shown will cost 57,000 jobs.
eBay praised the decision to cut business rates, calling it an “important boost” for online firms. eBay UK’s new MD, Clare Gilmartin, said: “Cutting edge firms like these are essential to restoring the British economy to growth, and we are pleased that the Chancellor is listening to their concerns.”
Excellent sentiments. Let’s just hope Ms Gilmartin practices what she preaches, ehh.