Nine in ten leading business people from across the region are confident the Budget has done enough to bolster local enterprise, with 70 per cent saying they are more optimistic about business growth prospects over the next two years, following a poll at accountancy firm BDO LLP’s Budget breakfast event yesterday morning.
The event, which attracted almost 200 people from the business community, was held at St Mary’s Stadium. Attendees came to better understand how the Chancellor’s announcements will affect their business and personal tax matters and to hear expert commentary from BDO, with partner Stuart Lisle, as well as Paul Braye and Paul Duckworth addressing the audience.
Stuart Lisle, tax partner at BDO in Southampton, pointed out that the Chancellor’s reduction in corporation tax to 24 per cent means the UK has by far the lowest corporation tax in the G7, the next being Canada at 28 per cent. In the G20 the UK is the fourth lowest, with the lowest being set at the 20 per cent which the Chancellor is aiming for over the next few years.
But business leaders are concerned that this is still not enough to attract business to the UK. A large majority believe the UK’s tax system remains uncompetitive on an international scale.
BDO drew attention to the Enterprise Management Incentives that were not widely mentioned in TV coverage. These are targeted at companies employing fewer than 250 employees with less than £30m gross assets.
BDO’s Paul Braye said: “In my opinion there is no better scheme for getting shares to employees if your company qualifies. Many of the rules have been relaxed in the Budget and the Government wants to improve and expand on the scheme, which enables companies to incentivize, reward and retain staff.
“Of interest to our region’s Universities, the scheme will probably extend to academics that do invaluable work in research; something that has not been permitted in the past.”
Braye also drew attention to changes made to the new Seed Enterprise Investment Scheme (SEIS) targeted at start-ups. “There will be 50% income tax relief on money invested in fledgling companies and Capital Gains Tax exemption on sale, amongst other attractive incentives.”
At the event, SMEs were also urged to look at Research & Development (R&D) tax relief because of various changes making it easier to claim, and to examine the Patent Box regime which gives incentives for patenting inventions, plant varieties etc.