Budget
Freedom: Enterprise
A long-lasting economic recovery must have its foundations in the private sector, not the public sector, and businesses across all regions need the right conditions to be able to grow.
Tackling the deficit will help provide the stable foundation needed for sustainable, long-term economic growth. As the UK’s competitiveness has declined in recent years, the Government is taking action to create a business environment that supports enterprise in the future.
The Budget announces:
- A reduction in corporation tax from 28 to 24 per cent over the course of four financial years from April 2011, giving Britain the lowest rate in the G7 and one of the lowest in the G20.
- A reduction in the small profits rate of corporation tax to 20 per cent from April 2011, instead of the planned increase to 22 per cent.
- Cutting national insurance, making it cheaper for companies to employ people. The threshold at which employers start to pay National Insurance will be raised by £21 per week above indexation in April 2011.
- A new tax scheme to help create new jobs in parts of Britain outside the Greater South East by exempting new businesses from up to £5,000 of employer National Insurance Contributions payments for each of their first 10 employees hired.
- The Enterprise Finance Guarantee (EFG) supports lending to small businesses that find it difficult to access normal commercial loans. To ensure that more small firms have access to credit, the EFG will be increased by £200 million to support £700 million of additional lending until 31 March 2011.
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