Statement did not go far enough on business rates
Today’s Autumn Statement has done little to allay concerns over punitive business rates, according to experts at Moore and Smalley.
Tony Medcalf, tax partner at Moore and Smalley, said: “This Autumn Statement has turned out to be an anti-climax for those businesses that were expecting to hear about business rate reform.
“Granted, the chancellor did cap the inflation-linked increase in business rates at 2 per cent, as he did last year, and he extended the doubling of the small business rate relief to April 2016. There was also a 50 per cent increase in the existing rates discount to help high street shops, pubs and cafes to £1,500 next year.
“While that is welcome, we did not see was any meaningful detail to back up the government’s previous hints at wider reform of the structure of business rates.
“The only mention of this in the chancellor’s speech was a brief reference to the review that’s already underway and that is not due to report until March 2016, so we haven’t learnt anything new. It could be another two years at least before we see any real changes to the business rates system.”
Commenting on other measures announced in the Autumn Statement, Tony added: “The reduction in stamp duty on home purchases was the big rabbit out of the hat. This means homebuyers will pay stamp duty on a slice of the home value, rather than a slab, and is something that will please voters ahead of the election.
“The expansion of the British Business Bank and the funding for lending scheme will be welcomed by firms looking to secure expansion funding. The R&D tax credit for smaller firms was also increased to 230 per cent, which is good news for those small businesses serious about innovation, however, this is tempered by the introduction of some new restrictions on qualifying costs.
“There were a host of tax avoidance measures, such as the 25 per cent tax on UK profits for multi-national technology companies, a further tax on banks and a tax for so-called non-doms, wealthy individuals who pay less tax by not having a permanent residence in the UK. These measures are clearly designed to show the government is being tougher on big business and the rich.”