A rethink on business rates, a better tax regime for oil and gas firms and a rise in stamp duty are topping Teesside companies’ wishlists ahead of the UK’s Budget tomorrow.
Businesses are also asking Chancellor George Osborne calling for more support for start-ups and SMEs to help maximise growth.
Richard Farr, partner at chartered surveyors Sanderson Weatherall, said: “The Government decision to delay the re-basing of business rates from 2015 to 2017 is going to hit many smaller companies who will have to pay out on the basis of values set at a peak time. George Osborne can do a lot of good by reversing this decision.
“Additionally, with the widespread economic benefits that increased house building can bring, increasing the threshold for Stamp Duty would assist affordability in the market, helping buyers and builders alike.”
View gallery Teesside business leaders outlined wishlist for Budget
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Willie O’Neil, contract lead at Wynyard-based Nortech Oil & Gas, said the North Sea needs a more effective tax regime.
“The existing structure was created in an era of large low-cost fields when there was a strong case for taxing the economic rent which was being generated.
“A new regime should reflect the current realities. That means strong incentives for both exploration and development with upfront capital allowances. These should be extended to new companies coming in to manage late life development of the remaining reserves in and around existing fields.”
Growthfunders, the North’s first online equity crowdfunding platform, wants a boost for new businesses.
Co-founder Craig Peterson said: “First, to encourage growth, the Chancellor can help create a better economic environment for employment among newer businesses by introducing a reduced rate of National Insurance for businesses in their first five years of operation.
“Second, funding for start-up businesses is vital, so we would like to see an extension of tax breaks for seed capital investment. An increase in the relief threshold for SEIS compliant investments, from the current level of £150,000 to £250,000 will not only make such cash injections more appealing to investors, but also give the recipients a stronger platform on which to build their business.”
Mike Odysseas, managing director of Stockton-based Odyssey Systems, said: “Small businesses are still shouldering too heavy a tax burden. It was great that the Government decided to extend the small business rate relief scheme for another year, but this simply isn’t enough to nurture the green shoots of recovery which are now apparent.
“To enable businesses to maximise growth, I would like to see an indefinite extension of the relief scheme, which would alleviate financial strain and facilitate economic progression.
“The Corporation Tax cuts we have seen George Osborne make so far have mainly benefitted the 80,000 larger businesses in the UK, rather than the 1.5 million SMEs which make up the bulk of the economy. I’d like to see this balance redressed with a bit of tax relief for smaller companies which would give the UK a real and tangible economic boost.”
David Copland, general manager, marketing and communications at Darlington Building Society said he’d like to see measures in the budget that would benefit savers.
“The Government can stimulate the savings market by increasing the ISA limit and introducing new ISA products for first time savers to encourage investment. Anything that increases individuals’ discretionary spend has to be good for the economy, whether through tax or NI cuts. It is time the Government looked again at the stamp duty threshold, particularly to help first time buyers get on to the property ladder.”
Meanwhile George Hardey, senior tax Manager at Hartlepool accountancy firm Waltons Clark Whitehill, said: “As we move away from the downturn, it is vital that investment and growth are encouraged over the course of the next couple of years and beyond, whichever party wins the next General Election.
“In a Budget that is just over 12 months before a General Election, we can’t really expect to see anything controversial, as the Chancellor won’t want to hit voters too hard. It will be a budget that looks like it gives more than it takes, maybe with something to keep pensioners happy.
“For the rest of us I would expect little change but cautious hopes include a small rise in the Personal Allowance now that it has reached the promised level of £10,000. A small rise in the higher rate threshold may also be forthcoming, though any change in the top rate of tax of 45% would be unexpected.
“However, the key has to be the encouragement of growth and investment in businesses. Taking the foot off the gas in terms of growing the economy could well prove fatal in the run up to the election and I would like to see a reduction in National Insurance contributions and the simplification of corporation tax, with a possible cut to 18% or 19% making the UK’s corporate tax regime increasingly attractive to incoming businesses.”
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