The Chancellor Philip Hammond made his first and, it became clear, last Autumn Statement at the dispatch box yesterday. In our post-Brexit vote world, forecasts are ever-changing, but it was clear the path of austerity and paying down the deficit in this Parliament, which his predecessor George Osbourne took, is no longer viable (if it ever was!)
So what were the changes he made which are likely to impact on small businesses?
- The pledge to lower corporation tax to 17% by 2020 is being honoured.
- He committed to advancements in UK science and tech innovation by confirming an additional investment in R&D, rising to an extra £2 billion per year by 2020-21.
- He injected an additional £400m into venture capital funds through the British Business Bank, unlocking £1 billion of new finance for growing firms.
- He doubled UK Export Finance capacity to make it easier for British businesses to export.
- He committed to implementing a business rates reduction package worth £6.7 billion, lowering the transitional relief cap from 45% next year to 43%, and from 50% to 32% the year after. Those in rural areas will get an annual tax break of £2,900 (but that’s no good to you if you are based in south-west London!) This was balanced with an alignment of the employee and employer National Insurance thresholds to £157 per week from April 2017, adding there will be no cost to employees, and the maximum cost to business will be an annual £7.18 per employee.
- He announced a new 16.5% VAT flat rate for businesses with limited costs which will take effect from April 2017.
Our friends at Hartley Fowler have put together a comprehensive summary for us all which you can read here.