Chancellor George Osborne declared that he wants to make the UK "Europe's technology centre" as he pledged to simplify taxes for small businesses, help young entreprenueurs get up and running, and cut the corporation tax rate even further.
Osborne characterised the measures unveiled today as "the biggest reduction in business red tape ever undertaken".
Corporation tax has already been cut from 28 per cent to 26 per cent under the coalition's watch and, next month, is due to be dropped to 25 per cent. It will now be lowered a further point to 24 per cent, and a point in each of the next two years, taking it to 22 per cent in 2014.
From April, said Osborne, the UK will have a rate 18 points lower than the US, 16 below Japan, 12 less than France and eight points below Germany. The goal is ultimately to take the rate to 20 per cent, claimed the chancellor.
For small businesses, the plan is to revamp the tax system to make it much easier to navigate. For firms with a turnover of less than £77,000, the government will consider implementing a system wherein they are taxed on the cash that goes through their business, rather than the complicated systems used for big firms, said Osborne.
The chancellor also confirmed today that 24 enterprise zones will go ahead, including ones in Wales and Northern Ireland.
"Chinese investment is pouring into the zone in Liverpool," he said.
Osborne opined that he does not want the UK to sit and watch while the BRIC countries surge ahead. The government plans to double the annual worth of British exports to £1tn during this decade, he said.
Incentives will be offered to start-ups and exporters, while the government is also considering the introduction of "enterprise loans" for young entrepreneurs who want to start businesses. The chancellor likened these to the existing student loan system.
Osborne outlined that he wants the UK to become "Europe's technology centre" and announced that he will invest in superfast broadband infrastructure in 10 of the UK's biggest cities. Smaller towns and rural areas will be able to draw on a £50m pot to invest in the technology.
As expected, today's headline measure was a cut to the top tax rate of 50p, which will be lowered to 45p in April 2013. UK GDP growth is expected to stand at 0.8 per cent this year, and two per cent next year.
"This budget rewards work – Britain is going to earn its way in the world," said the chancellor.
Phil Smith, UK and Ireland chief executive of Cisco, said: "What's most important from a business perspective for this Budget is that the government continues to take steps to create an environment in which start-ups and small businesses can grow.
"There is without doubt a need for the government to develop new sources for long-term growth in the UK. This has already led to a significant focus on the efforts of small to medium-sized enterprises, particularly those working in the area of technology-enabled innovation."
Paul Sweeney, managing director at VAR ANS Group, said: "This is a fantastic budget for business, the reduction in corporation tax will help us to reinvest in the local economy and create jobs."
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