Chamber Reacts to Budget Speech

Responding to the Chancellor’s Budget Speech Chris Fletcher, Policy and Communications Director at Greater Manchester Chamber of Commerce, said: “There was an awful lot riding on the content of today’s Budget especially for those businesses still struggling with the impact of Covid, such as the hospitality and tourism sectors. The first part of the Chancellor’s speech would have given them and others some comfort with the expected extension of the furlough scheme to June then a tapering off until September; supporting this are new rounds of grant monies and business rate reductions. The phasing of VAT will also bring some relief. Alongside new measures to help businesses recruit and re-open in the short term this all seems positive though there are still a huge number of business owners excluded from government support and, as we approach the first anniversary of lockdown, this is far from acceptable.

“As regards paying the huge amounts of government borrowing back, again the announcement of personal tax threshold freezes was expected, however the confirmation of a Corporation Tax increase to 25% effective from 2023 would be seen as a significant reverse in what has been a core Conservative policy since 2010. To offset this a new small profit level of £50k has been introduced, which unfortunately further complicates the UK’s corporate tax rules which for many years have needed simplifying, but it will mean some businesses will continue to pay their tax at the existing rate of 19%.

“The Chancellor’s final section on building a stronger future was, apart from a few exceptions, a bit lacklustre. The move ‘north’ of some of the Treasury to Darlington, the setting up of a new Infrastructure Bank in Leeds and the go head for the first eight Freeports are all welcomed. The big announcement around a new ‘Super-Deduction’ model aimed at boosting investment in new equipment was a real bonus and could unlock cash reserves but, overall, there felt little progress on investment plans for the economy - levelling up - beyond what we have heard over the last few years. Whilst Covid has obviously intervened dramatically, the solutions and proposals on offer for future prosperity, a zero-carbon environment and radical investment felt a bit flat.

“As ever the details will come out over the coming days and we will be making further analysis on what this all means for business. What is still to be seen is what, if any, impact Brexit will have on these economic forecasts and plans. With more businesses facing problems, increased costs and delays with international trade it’s important that the impact of this is monitored closely.”

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About Greater Manchester Chamber of Commerce

Greater Manchester Chamber of Commerce is the largest Chamber of Commerce in the UK, providing business support to approximately 4,500 members who collectively employ 446,000 people, around one-third of Greater Manchester’s workforce. Recognised as a leader in its field, Greater Manchester Chamber’s reputation in government circles has grown locally and nationally. At the heart of the area of greatest economic intensity outside London and the South East, the Chamber is the primary body for business support, policy, representation and networking. The Chamber is an independent, not-for-profit private company and its aim is to support businesses and help create the best climate for the region to prosper. This is achieved by ensuring that those taking decisions on key issues such as transport, taxation and business regulation hear the voice of our members. The representation of our members’ views is central to the work of the policy team at the Chamber; these views are gathered in a range of ways including our local councils, policy committees, sector councils, the main Chamber council, focus groups, meetings with politicians and consultations. The Chamber also offers a range of networking forums across Greater Manchester, free as part of membership, plus a variety of other events and services designed to benefit specific sectors or individuals and help businesses to grow.

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