UK plans £11 billion, three-year business tax break in budget
- Britain’s finance minister will limit the relief to three years and propose a permanent replacement in the Conservative Party’s manifesto, Bloomberg News reported
- Under this replacement full-expensing regime, companies will continue to save 25 pence on their tax bill for every £1 invested, the report said
British finance minister Jeremy Hunt will hand businesses a three-year tax break worth £11 billion (US$13.23 billion) by replacing the UK’s investment allowance with a temporary measure in next week’s budget, Bloomberg News reported on Saturday, citing a government official with knowledge of the matter.
Hunt will limit the relief to three years and propose a permanent replacement in the ruling Conservative Party’s manifesto before the next election, the report said.
Under this replacement full-expensing regime, companies will continue to save 25 pence on their tax bill for every £1 invested, the report said. A previously announced increase in the headline rate of corporation tax, to 25 per cent from 19 per cent, is expected to come into force in April.
“For the manufacturing industry … those capital allowances work, so I would say, we do want to bring down our effective corporation tax, the total amount people pay,” Hunt said in a GB News interview, referring to measures which allow companies to offset capital expenditure against their tax bill.
Hunt is expected to present his budget on Wednesday.
