Business rate reforms, commercial stamp duty changes and infrastructure funding were announced by the Chancellor in today’s (16 March) Budget.
Addressing the House of Commons, George Osborne hailed the government’s financial plan for Britain as a “Budget that gets investors investing, savers saving, businesses doing business,” unveiling a raft of new measures.
As well as confirming a “green light” for the High Speed 3 rail link between Manchester and Leeds, M62 improvements and a new transpennine tunnel between Manchester and Sheffield, as reported earlier this week, the Chancellor unveiled a cut to business rates.
Businesses occupying commercial properties with a value of £6,000 or less are currently eligible for a 100% relief but from April 2017, small firms occupying property with a rateable value of £12,000 or less will pay no business rates. There will also be a tapered rate of relief on properties worth up to £15,000.
Having begun a reform of stamp duty last year, starting with residential property, the Chancellor went on to announce in his 2016 Budget that commercial stamp duty will also see changes in a bid to help smaller businesses.
He told Parliament: “At the moment, a small firm can pay just £1 more for a property and face a tax bill three times as large. That makes no sense.”
From midnight tonight commercial stamp duty will have a zero rate band on purchases up to £150,000; a 2% rate on the next £100,000; and a 5% top rate above £250,000.
A new 2% rate will also be added for high value leases with a net present value above £5 million.
Meanwhile Corporation Tax is set to be cut to 17% by 2020, and new tax allowances were also revealed by the Chancellor to help ‘micro-entrepreneurs’ selling services online in a move he referred to as a “tax break for the digital age”.
The Chancellor added: “I want to address the great unfairness that many small businessmen and women feel when they compete against companies on the internet.”