Autumn Statement 2013: Chancellor announces capped business rates

Thursday 5 December 2013

Chancellor George Osborne has today (December 5th) announced that business rates in England are to be capped at two per cent instead of being linked to RPI.

In his Autumn Statement he explained that some retail premises in England will get a discount, and businesses moving into vacant high-street properties will see their rates slashed by 50 per cent. 

The chancellor announced a whole raft of measures to tackle tax avoidance, evasion, error and fraud in his speech. It is hoped these will raise more than £9 billion over the next five years. 

One of the changes revealed in the Statement is that personal income tax allowance is to rise to £10,000 from April 2014. It will also see further increases from 2015-16, which will be linked to the CPI measure of inflation. 

What’s more, capital gains tax is soon to be imposed on future gains made by non-residents selling property in the UK. This measure will be implemented from April 2015. 

In addition, from April, new tax relief will be introduced that will apply to investment in social enterprises and new social impact bonds. 

From January 1st 2014, the rate of the bank levy will increase to 0.156 per cent. This rise is expected to raise £2.7 billion in 2014-15, and £2.9 billion every year from 2015-16. 

Jobs

Employer National Insurance will also be axed on 1.5 million jobs for young people, while stamp duty bought in exchange for traded funds is also to be scrapped. 

When it comes to jobs, the government is continuing its support of SMEs, with a boost in the coalition’s start-up loans scheme aiming to help 50,000 more people start their own businesses. Additionally, the government is also doubling the export finance capacity that is available to support British businesses. 

Experts have predicted that 3.1 million new jobs will be created by 2019, with 400,000 of them starting this year. 

Economy

Next year is set to see significant economic growth, according to Mr Osborne. He revealed that the growth forecast for this year has increased from 0.6 per cent to 1.4 per cent, and predictions for next year have also grown from 1.8 per cent to 2.4 per cent. 

However, the following three years will see a slight drop in economic growth, according to the chancellor’s figures, dropping to 2.2 per cent, 2.6 per cent and 2.7 per cent. 

What’s more, revised figures from the Office for National Statistics show that UK GDP dropped by 7.2 per cent in 2008-09, down from the previous figure of 6.3 per cent. This means it actually declined by the equivalent of  £112 billion. 

Pensions

The pension system is to undergo yet more reforms, according to the Autumn Statement. State pension age will increase to 68 in the mid-2030s, rising to 69 in the late 2040s. In addition, from April 2014, the state pension will increase by £2.95 a week. 

Further information

Please read our reactions blog for Brookson's MD Hartin Hesketh's opinions.

You can also download our free guide, will give you detail on the forthcoming changes. 


By Victoria McDonnell

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