“It was another extraordinary budget from the Chancellor, reflecting what is an extraordinary time for the UK economy.
“Businesses will welcome an extension of the full range of COVID-19 support measures, with the timescales longer than many were expecting. The extension of the furlough scheme, an extended and more targeted self-employed scheme, a new tranche of business grants and a new recovery loan scheme will all continue to provide a safety net for businesses through to the autumn. There will be disappointment, however, that limited company owners appear yet again to have been forgotten.
“Overall, given the uncertainty that still hangs over the ending of lockdown, the Chancellor’s approach makes good sense and contrasts favourably from the ‘stop start’ approach to previous business support extensions.
“The Chancellor’s pledge to “continue doing whatever it takes” will put businesspeople at ease, many of whom still face extremely challenging times ahead. Nevertheless, there was a sting in the tail – with the Chancellor setting out a path to repairing the public finances.
“Rather than targeting the broader public, the weight of tax rises will fall on the private sector – most notably with a rise in corporation tax to 25% in 2023 – a higher level than many were expecting. There is some tapering for companies with very low profits. There was however a big, short term incentive for firms to invest in new plant and machinery via a “super deduction” at 130% over the next two years, and more loss flexibility for struggling businesses.
“Many businesses recognise that the government’s generosity has to be repaid – but will worry that it will fall on a relatively narrow set of wealth creators, making the tax base more vulnerable to changes in economic circumstance and reducing our international attractiveness.
“In regional terms, the West Country looks like it is losing out. Bristol failed to secure a Free Port for the region, as much of the focus of the Chancellor was fixed on the North of England, Scotland and Wales. This is disappointing and we encourage our MPs and political leaders to continue to fight for our fair share of levelling up money to address the needs of this region.”