Creating a tax system that is more supportive of business investment
The Chancellor George Osborne delivered his plan for growth, announcing some significant steps towards creating a tax system that is more supportive of business investment and growth.
Mr Osborne provided further clarification on matters that were already under discussion in existing consultations, but the additional cut in the main rate of Corporation Tax was an unexpected announcement. The Chancellor’s effective tax increases in the banking and oil and gas sectors were less well received. The expected reintroduction of enterprise zones and changes to investment incentives and entrepreneurs’ relief are aimed at increasing support for new and growing businesses.
He also announced a number of unexpected moves, including a radical new relief from Inheritance Tax on gifts to charities and a reduction, rather than the planned increase, in fuel duty. Similarly, although it had been widely trailed, the decision to consult on integrating the Income Tax and National Insurance systems will be very welcome. However, this will have significant implications for all businesses.
As well as the specific reliefs that will be abolished after the review by the Office of Tax Simplification (OTS), the Budget included a wide-ranging review of existing and proposed legislation which will remove anomalies and reduce the impact of the tax system on business.
