Autumn Budget 2021 – What has been announced for businesses?
Today Chancellor Rishi Sunak has announced his Autumn Budget for 2021, which has been eagerly awaited by the general public. A number of key announcements had been made prior to the main Budget, including the rise in the national Living Wage from £8.91 per hour to £9.50 per hour, the U-turn on the public sector pay freeze and additional investment in the NHS, however, there has been less coverage before today in relation to the measures designed to boost the business community.
A number of today’s announcements aimed at businesses, were sector specific:
- there was the suggestion that the investment in 180,000 new affordable homes would be subsidised by property developers with profits over £25million with the introduction of a 4% levy;
- those required to travel domestically (whether for business or otherwise) will enjoy a reduction in Air Passenger Duty, the idea being that the further one has to fly, the higher duty they will pay, which could be a good indication of investment in business within the United Kingdom;
- there was also mention of a reprieve in the shipping sector with beneficial changes to the tonnage tax, which the Government seem pleased about being able to deviate from the previous EU requirements. Those in the haulage sector will also enjoy the extension of the suspended HGV levy until 2023 and the freezing of Vehicle Excise Duty for HGVs;
- for culture and the arts, the sunset clause tax relief for museums and galleries is set to be extended until 2024 and the cultural relief rate for the arts sector is set to be doubled until 2023;
- those in retail, leisure and hospitality could benefit from a number of measures:
- firstly a 50% reduction in their Business Rates up to a maximum of £110,000; and
- a good portion of Mr Sunak’s announcements also focussed on an overhaul in Alcohol Duty and reliefs. In order to assist the pubs in the United Kingdom, there is set to be a 5% cut on the duty payable on draught beer and cider. A Small Producer Relief boosts will be introduced to assist small brewers and cider producers producing beverages under 8.5% ABV. There is also due to be a cut in the duty payable for fruit cider and the abolition of the premium in duty on sparkling wine.
In addition to the sector specific measures, there were a number announcements that affect the business community as a whole:
- the £1million investment allowance being extended to 2023;
- changes in Business Rates. Mr Sunak has proposed an overhaul of the Business Rates regime with a view to making it fairer across the board. It has been proposed that revaluations can be carried out every three years to decrease the likelihood of a business paying rates which are proportionally too high or too low. There has also been the proposal to provide a relief for businesses investing in “green tech” and an improvement relief meaning that businesses will be able to make improvements to their business premises for the time being without being subject to an increase in Business Rates for 12 months; and
- in the earlier stages of the Autumn Budget, Mr Sunak turned attention to Research & Development (R&D) announcing that the tax relief on R&D will be expanded to cover cloud computing and data. In a further reform, from April 2023 the relief will be designed to subsidise investment at home in the United Kingdom following the realisation that the current system subsidised R&D taking place outside the United Kingdom, which is not consistent with how it currently operates in other countries.
If you have any questions on how Budget 2021 may affect your business or if you need legal support over the coming period, please email or call Blacks’ Corporate Law team on 0113 207 0000.
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Corporate Law
CJackson@LawBlacks.com
0113 322 1910
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Callum Jackson
