Autumn Statement: Rise in investment allowance ‘huge boost’ to business
Businesses will welcome the rise in the amount of capital investment that qualifies for tax relief from £25,000 to £250,000. This is a huge and unexpected increase that should encourage businesses to invest in plant and machinery and enable them to create new jobs.
The further reduction in the main corporation tax rate from 22 per cent to 21 per cent will also be welcomed by the business community.
The decision to abolish the planned 3p increase in fuel duty will be a relief to those who rely heavily on cars to get to and from work, and also from businesses that are heavily dependent on fuel, such as haulage and transport firms.
The government has been under huge pressure to justify its mantra that ‘we’re all in this together’, so it was always likely that Mr Osborne was going to announce new taxes to hit the wealthy. News of a proposed general anti-avoidance rule to come in next year will make it harder for wealthy individuals to evade tax, but could impact on legitimate tax planning by smaller businesses.
New limits on pension contributions for higher earners and reductions in the lifetime allowance could impact those who have the potential to create wealth, such as business owners and entrepreneurs.
Proposals to make the bank’s lend more money to businesses will be popular, but whether this will actually result in more firms being able to access funding remains to be seen.