Autumn Statement call for Chancellor to support growth business investments
The industry body responsible for the Enterprise Investment Scheme (EIS) and the Seed Enterprise Investment Scheme (SEIS), the EIS Association (EISA) is calling for the Chancellor to recognise the importance of private sector investment into the UK’s early stage growth businesses when he delivers his Autumn Statement on the 27 October.
The Enterprise Investment Scheme provides tax incentives to investors who support growth businesses in their early stages and is one of the main routes for entrepreneurs to access the capital they need to develop.
In the ‘Reigniting the UK’s Entrepreneurial Ecosystem Report’ looking into how to reboot the post pandemic economy, an investment gap for seed funding of £768m and for growth funding of £1.45bn was identified. Attracting investment from the private sector is key to filling the gap, and the simplification and continuance of the EIS scheme is paramount in hitting these targets.
The EISA is calling on the Chancellor to address four principal areas:
• Assurances that every effort will be made to ensure the continuation of the EIS and SEIS schemes, particularly beyond the current sunset clause of 2025.
• An increase in the SEIS lifetime allowance from the current £150,000 to £250,000
• Replace the “age restriction” on eligible recipients of State Aid with a different threshold
• Further investigation into how money held in pension funds can be used to fund EIS and SEIS qualifying companies
Director General of the EISA, Mark Brownridge commented, “We all recognise that the Chancellor has an enormous job to do in balancing the economy, and ensuring that we support the country’s growth businesses, bringing with them employment, profitability and tax income is an important component in that agenda. Much of the investment for growth businesses in their early stages comes from the private sector, and it is imperative that we see the government proactively backing the EIS scheme to ensure that the access to this important source of capital continues. At the top of our wish list is a call for the formal extension of the current scheme beyond 2025, so that both investors and entrepreneurs can plan their future for the benefit of the economy as a whole.”