The Scotsman

More treats than tricks on offe

● UK’S bustling entreprene­urial economy ‘well-equipped for a resilent post-brexit future’, according to one commentato­r


Chancellor Philip Hammond was praised for unveiling a string of measures to support the UK’S entreprene­urs, with yesterday’s statement deemed to be “bringing more treats than tricks for business”.

He stressed the belief that encouragin­g entreprene­urs “must be at the heart of any strategy for a dynamic economy”.

Steps to reinforce this included an increase in the annual investment allowance (AIA) from £200,000 to £1 million for two years “delivering on a long-standing ask of the British Chambers of Commerce”, and a targeted relief for the cost of acquiring intellectu­al property-rich businesses.

Permanent tax relief for new non-residentia­l structures and buildings was also introduced. Furthermor­e, the funding of start-up loans is to be extended to 2021, helping 10,000 entreprene­urs, and it was announced that small and medium-sized enterprise­s could benefit from reduced contributi­ons for apprentice­ships.

Carolyn Fairbairn, director general of the CBI, said: “This was a rock-solid budget, bringing more treats than tricks for business.

“It recognises the enormous contributi­on enterprise has made to balancing the UK’S books through jobs, pay and tax and responds to many of the recommenda­tions that firms have made.”

Taking a similarly positive tone was Luke Davis, founder and chief executive of private investment house IW Capital, who praised a Budget “for the small and growing”.

And he said Hammond “provided due acknowledg­ment to a nation of entreprene­urs who will lead the charge for a buoyant private sector post-brexit”.

He added: “The UK’S alternativ­e finance arena, albeit buoyant, will only flourish to its optimum capacity if fiscal and policy-led initiative­s such as business rates, entreprene­urs’ relief, VAT, and corporatio­n tax are addressed headon, particular­ly with Brexit around the corner.”

“The UK’S entreprene­urial economy is well equipped for a resilient post-brexit future.”

Hammond also announced an additional £200m of funding to the British Business Bank to replace access to the European Investment Fund “if needed”.

And that may “allay some fears of businesses who have relied upon EU grants/funding,” according to Richard Dillea, director at accountant Mazars, which has offices in Edinburgh, Glasgow, and Perth.

And he believes that overall the Budget “has committed to the engine room of the UK economy”, adding that the “generosity and conditions surroundin­g the relief for acquiring ‘IP rich’ businesses are yet to be seen, however, relief for capital expenditur­e on such businesses would reduce the ‘after-tax cost’ and may instigate further investment­s/transactio­ns”.

He was also among observers to address the annual investment allowance, and believes that lifting the minimum qualifying period from 12 to 24 months could make the relief more difficult to obtain.

Philip Salter, founder of The Entreprene­urs Network, said the increase to £1m “will be a welcome announceme­nt for business owners looking to invest, but by making it temporary the government is failing to offer businesses the stable environmen­t they need to properly plan for the future”.

“Over recent years the AIA has yoyo-ed from £100,000 down to £25,000, up to £200,000, up to £500,000, down to £200,000, and now temporaril­y up to £1m. This is the epitome of business uncertaint­y.”

He said that all in all it was not a “perfect” Budget for entreprene­urs, with the likes of business rates relief representi­ng “missed opportunit­ies for fundamenta­l reform”.

But taking a more positive tone was Jenny Tooth, chief executive of the UK Business Angels Associatio­n, who said Budget amendments “have not come at the expense of a thriving entreprene­urial community”.

“The entreprene­urs’ relief is an incentive for entreprene­urs to set up, grow, sell and reinvest into UK businesses and to contribute to the nations thriving economic environmen­t… Hammond stated that entreprene­urs are at the heart of our dynamic society – this is very much the case and the UK’S entreprene­urial spirit will continue to boost our thriving economy throughout Brexit negotiatio­ns.

“Resilience planning for Brexit now needs to be of the utmost importance across the UK’S business agenda to ensure a Brexit-proof economy.”

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