Budget 2012: Business wanted more action on red tape

 BUSINESS leaders today expressed disappointment that Chancellor George Osborne did not go further in cutting the burden of regulation on business.

Despite cutting corporation tax, reviewing the way small businesses pay tax and promising future action on measures hated by firms such as the carbon reduction commitment, the Chancellor’s third Budget did not go far enough for business organisations.

John Cridland, director-general of the CBI, said: “Family budgets have been under great pressure, and by putting more money in the pockets of ordinary people, the Chancellor has provided a much-needed confidence boost.

“The Chancellor has also painted a clearer vision of how the UK will earn its living in the future and, by seizing the opportunity to make sure our corporate tax system is more internationally competitive, he has sent a powerful signal to companies to invest, do business and create jobs in the UK.

“An extra one per cent off corporation tax this year could make a big difference to investment intentions. Plans to reduce the top rate of tax to 45p by April 2013 will show our top and aspiring talent that this Government wants them to create wealth here.

“If businesses were looking for more, it was in the area of deregulation. For smaller businesses, things may not feel very different on the ground. It would have also have been a huge relief if the Chancellor had taken the opportunity to get rid of the currently unworkable Carbon Reduction Commitment.”

Mr Osborne billed his Budget as one to “back business” but there was regret that he did not match his bold move on corporation tax in other areas.

Simon Walker, director-general of the Institute of Directors, said: “While any tax reduction is welcome, the Chancellor has not done enough to free business from the burdens and barriers that are holding economic growth back.

“Businesses dearly want the opportunity to invest, create and build, but George Osborne must go much further if he wants to fire up the engines of the economy. There was a bold move on Corporation Tax, but in the bigger picture this is still not far enough or fast enough.”

Mr Osborne used his Budget speech to recommit the Government to rebalancing the economy away from financial services.

Terry Scuoler, chief executive of EEF, the manufacturers’ organisation said: “The Chancellor began positively by setting out his thoughts for a new economic model. But, by the end of his speech, the task of rebalancing our economy looked as daunting as ever.

“Whilst there are some helpful measures, they fail to send a strong enough signal to growing manufacturers that now is the time to bring forward their investment plans and to do it here. The corporation tax cut is welcome but, on its own, it is not the silver bullet that will unlock the business investment our economy urgently needs.”

 

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