A PRO-BUSINESS (AND NOT SO MINI) BUDGET FROM OUR NEW CHANCELLOR
Our high streets, towns and cities are facing big challenges this winter from a medley of rising energy bills, inflation, staffing issues and consumers tightening their belts — and we’re pleased to see the new Prime Minister and her team responding with their series of announcements this week.
On Wednesday we heard that energy bills for businesses will be cut by about half their expected level this winter. Fixing wholesale gas and electric prices for six months from October will help thousands of businesses from crippling costs. This is a massive but necessary intervention, and they will need to keep this under review and make sure at risk industries get further help should they need it.
And this morning Chancellor Kwarteng announced a rather pro-business growth plan for the longer term which included cancelling the planned rise on National Insurance; cancelling the planned corporation tax rise (it will remain at 19% giving businesses the chance to invest, innovate and grow); and cancelling the planned duty rises on beer, wine and spirits. Interestingly they are looking at creating more than 40 new enterprise zones across the country, where planning rules will be relaxed and business taxes reduced to encourage investment. Rather unexpectedly, VAT free shopping for overseas visitors will be introduced, which is fantastic news for retail across the country, and will help draw visitors into surrounding pubs, restaurants and hotels too.
Of course this comes alongside a package of tax cuts for households notably cutting the basic rate of income tax to 19p next year, and having a single top rate of tax of 40%. Alongside measures to cap household energy bills, this will help with consumer spending power this winter.
Of course, it remains to be seen how quickly we can pay for this — and indeed whether today’s package of announcements will lead to the medium term growth of 2.5% the government desires.
For more information:
https://www.gov.uk/government/news/government-outlines-plans-to-help-cut-energy-bills-for-businesses