Published on April 6, 2013
In the latest budget, Chancellor George Osborne announced that the corporation tax rate in Britain will be cut by an additional one per cent to 20 per cent by April 2015. This is in stark contrast to the previous 28 per cent rate which stood in June 2010 when the coalition Government came to power.
The latest cut in the UK’s business tax rate sends “a clear message to anyone who wants to invest here, to create jobs here, that Britain is open for business”, the chancellor said in his March Budget statement.
The cuts mean that the UK’s corporation tax rate is significantly lower than other economies including Germany (29 per cent), France (33 per cent) and the United States (40 per cent). Such tax incentives are aimed at attracting businesses to the UK.
Businesses have welcomed the announcement. CBI, the employers’ group, said: “An extra one penny cut in corporation tax will also make the UK one of the most internationally competitive locations in which to do business.”
Other business-friendly measures in the Budget include:
1. An ‘employment allowance’ for every company, which will reduce their total employers’ national insurance bill by £2000 each – making it even easier and cheaper to employ people in the UK.
2. Abolishing altogether stamp duty on shares traded on AIM, the London Stock Exchange’s international market for smaller growing companies.
3. The top rate of income tax on incomes of more than £150,000 will fall from 50 per cent to 45 per cent from April, making the UK more attractive to high earners.
4. A ‘Seed Enterprise Investment Scheme’, which offers generous incentives to investors in start-ups.
Hudson McKenzie works in close partnership with the UK Trade & Investment (UKTI) working to attract investment in to the UK and to retain Inward Investment.
In order to accelerate and enhance the client’s journey to the UK during their planning and implementation stages – and beyond, we can help you look at the UK’s key sectors and UKTI can provide the following services:-
1. Planning and strategy for the UK – This is essentially the early stage of set up, when the client is considering the UK as a potential investment location; HM in partnership with the UKTI can provide a range of support, research and guidance that helps them map out their vision for the UK. Sometimes at this stage, the UK in a competitive situation whereby the client is also considering placing their “Investment” in other countries too, or it might be that they know they need to be in UK but not sure where best to locate.
2. Set up and Implementation – when the client has definitely decided on UK, HM in partnership with the UKTI can provide real practical assistance with their “to-do-list” so the UK operation is up and running quickly.
3. On-going Support – From “Opening Day” onwards, HM in partnership with the UKTI can provide an aftercare relationship and help the client with their medium term UK vision.
4. Support from Whitehall- for strategy, policy, intra-governmental relationships and Ministerial reporting/access for large clients those that have high impact in the UK economy.
Rahul Batra is the Director and Head of Department at Hudson McKenzie. Rahul Batra can be reached at email@example.com