Chancellor springs business tax surprise
In an unprecedented move, chancellor Gordon Brown has today sprung a major surprise by announcing tax cuts for business three weeks ahead of the 17 April Budget.
According to the Treasury, business will receive tax cuts worth £500m in next month’s Budget. The Treasury has unveiled details of the measures three weeks ahead of the Budget because of its unusually late timing, ensuring adequate notice before the changes come into effect on 1 April.
The measures were set out in last November’s Pre-Budget Report. Tax cuts will be made in the area of research and development, relief from capital gains tax and a tidying up of the treatment of sales of patents.
Brown said in a statement: ‘In our first term we put stability and employment creation first. In our second term, as we prepare for the sixth Budget we are able to build on this platform of stability and employment creation and our energies must continue to be directed to promoting enterprise and investment and raising our country’s productivity.’
A new tax credit to boost R&D among larger companies will be announced in the Budget. This will benefit more than 1,500 firms spending more than £11bn. There will also be a tax exemption for gains and losses on substantial shareholdings aimed at ensuring business decisions on corporate restructuring are made for commercial, rather than tax, reasons.