Written by: Keith Tully
Reviewed: Wednesday 16th March, 2016
Among the most significant announcements of George Osborne’s second Budget of the new parliament was that more than half a million small businesses are to be relieved of the responsibility of making business rate payments from April 2017.
The measure could save companies as much as £6,000 each on an annual basis with roughly 600,000 British businesses expected to benefit financially as a direct result.
The decisions announced in the latest Budget will end the ad hoc introduction of temporary business rate reliefs that have been used in recent years.
Changes to the government’s stamp duty policies mean that 90 per cent of small businesses could potentially benefit from reduced stamp duty levels relating to commercial properties.
Commercial properties worth less than £150,000 will now be exempt from stamp duty, while any worth over £100,000 will be subject to 2 per cent charges and any worth over £250,000 will face 5 per cent charges.
Plans are now in place for the headline rate of corporation tax across the UK to be reduced to 17 per cent from 2020, with that reduction expected to be offset by the extra amounts recouped through proactive efforts to cut out tax avoidance.
Measures are to be introduced to prevent multinational companies from using “complex structures” to help them pay less tax in the UK and as a whole across their operations worldwide. These changes to the corporation tax rules are expected to add significantly to the total amounts paid annually as tax revenues to HMRC.
Among the more surprising announcements made by the chancellor in his latest Budget speech was that which outlined the government’s intention to introduce a new tax on soft drinks. The so-called sugar tax is designed as a measure aimed at limiting the harmful effects of sugary drinks on public health and particularly on children.
The government is continuing with efforts framed as support for the development of a so-called Northern Powerhouse and the creation of a counterbalance to the strength of the London economy in the north of England.
Plans to create a new HS3 rail line between Manchester and Leeds have officially been given the green light, while efforts to create a new four-lane M62 motorway are set to be fully funded and plans to build a road tunnel between Manchester and Sheffield are to be considered.