The Budget for 2012 has been set; see the link below for George Osborne’s key points.
Here, some North East business leaders give their thoughts post-budget, in relation to their industry. What did you think? How will the budget affect you? Share your thoughts by commenting below.
Sarat Pediredla is MD of mobile marketing agency hedgehog lab based in Newcastle upon Tyne.
“The Chancellor’s 2012 budget is a bit of a mixed bag for me. On a professional level, I think the budget is a letdown to many small and medium businesses in the digital sector that are in the growth phase. It’s great that Corporation tax is to be cut by 1%, which does provide a clear benefit but the budget does not go far enough to address rapidly growing businesses.
“One of the key pain points of businesses like ours is wage costs and job creation. I see nothing in this budget that helps with that. The simplified tax system is only applicable for what I would call “micro”-businesses with £77,000 or less turnover and this doesn’t really help businesses in our position.
“The budget also includes a tax relief for specific industries like games & animation. While I support this move completely, I would have liked to see this applied to the broader digital sector, especially with businesses under 100 employees.
“The only silver lining at this moment, if it works, is the renewed pressure on banks to lend more to small businesses which might go some way to cover the risk of growth but isn’t a genuine “benefit” in the line of tax cuts or grants.”
Karl Morton is sales manager for the North East region for homes developer Miller Homes.
“It was good to hear the chancellor reinforcing the Government’s commitment to supporting home buyers by underlining the importance of NewBuy and the reinvigorated Right to Buy schemes as tools for helping people purchase their first home or move up the property ladder. However, we would have welcomed more assistance for first time buyers through further relief on Stamp Duty Land Tax for properties at the lower end of the market.
“The chancellor also touched on the importance of reforming the planning system as a stimulus for economic growth and job creation. We believe this much needed overhaul of the system, through the introduction of the National Planning Policy Framework with a presumption in favour of sustainable development, is essential to stimulate the supply side and help house builders like ourselves bring forward new developments.
“It was great news to hear of further cash injection into the Get Britain Building fund and helps underpin the sentiment that new developments are key in helping to get the country back on its feet.
“It is my hope that the expected planning reforms will help builders to deliver such schemes promptly and that the Government continues to support those who are striving to move onto or upwards on the property ladder.”
Alastair Wilson is Tax Partner at Tait Walker Chartered Accountants based in Newcastle upon Tyne.
“The March 2012 budget doesn’t contain a great deal of new policy, but does continue the Coalition’s theme of encouraging entrepreneurial business.
“Viewing the Autumn Statement in November and the March 2012 Budget together, George Osborne has appeared to listen to many of the comments being made by business leaders across the UK and has sought to introduce changes which can help to stimulate the recovery.
“For entrepreneurial businesses there are welcome enhancements to the ability to raise funding via the Seed Enterprise Investment Scheme, and the National Loan Guarantee Scheme is a welcome boost to the capacity for SMEs to raise debt finance. A pilot scheme for enterprise loans to young entrepreneurs is also a positive announcement.
“Enhancements to the Research and Development Tax Relief, the introduction of a Patent Box regime and most significantly the introduction of tax credits for games developers and animators should all help to stimulate our region’s economy. It’s unfortunate that for some games development companies the new tax credit will have been introduced too late to keep them in the region, but it should encourage the large pools of skilled developers we still have in the region to set up and grow businesses with greater confidence.
“The creation of superfast broadband as a platform in Newcastle should also help to ensure that infrastructure does not stifle the creative industries in the North East. The confirmation of enhanced capital allowances available in the new Enterprise Zones in our region should help to encourage inward investment focused on both the Offshore and Automotive sectors.
“Not all of the changes which the business community would wish for have come to fruition. The scheduled increases in the fuel duty escalator are going ahead as planned for most road users and users of company cars continue to find their costs increasing in the form of additional taxation. There has been no movement on easing the burden of business rates and there was little announced to encourage investment in existing infrastructure in the North East such as our air, road or rail links.
“However for the business community in the North East I would suggest that when contemplating the March 2012 budget, like the Autumn Statement, the glass should be half full not half empty.”