BUSINESSES from across the county have given their views on chancellor Rishi Sunak’s budget.
Key details include Mr Sunak announcing that the government will not raise the rates of income tax, national insurance, or VAT but will instead freeze personal tax thresholds for the time being.
Corporation tax, which companies pay on profits, will also be raised to 25 per cent in 2023 however firms with profits under £50,000 will remain at 19 per cent.
Chief executive of East Lancashire Chamber of Commerce Miranda Barker said: “I think it’s pretty sound, I like the fact that he’s telegraphed where the future consequences are coming from because if he hadn’t done that people would say he wasn’t being realistic.
“I’m glad the furlough scheme is still in place because, particularly for the hospitality sector that’s absolutely crucial.”
Economies like Blackburn’s have been hit particularly hard by the crisis
Ms Barker also said that she was pleased to hear the announcements on VAT and believes that the newly announced super deduction tax, which will allow companies to claim 130 per cent tax credits from the cost of new machinery, could be of great interest to firms in Lancashire, along with the UK Infrastructure Bank.
She said: “The North of England, particularly Lancashire could be especially well placed to take advantage of this kind of investment.”
The measures were broadly welcomed by Blackburn-based accountancy firm PM+M, with managing partner Jane Parry emphasising the importance of paying off the national debt.
PM+M managing partner Jane Parry
She said: “Balancing being supportive but appearing tough on debt is a tricky balance and today’s Budget threw up no real surprises.
Ms Parry welcomed the announcement that the furlough scheme will be extended until the end of September and that 600,000 of the recently self-employed will also now be eligible for state financial help.
However, she cautioned that the only way to reduce the country’s debts will be via tax rises and that these, likely to include capital gains tax, will have to be introduced at some point soon.
Ms Parry said: “It’s just a question of when and by how much.
“Likewise, I think we can expect to see future inheritance tax tightening.
“For all the talk of the UK economy leading the world and the rhetoric about investment and growth, I think the biggest challenge for the chancellor over the coming weeks and months is to manage expectations that the Covid debt needs to be repaid but without choking confidence, which will be no mean feat.”
Meanwhile, Skelmersdale retailer Hotter Shoes said that the budget offered firms like them a significant lifeline but that tough times still lay ahead.
CEO Ian Watson said: “The new grant scheme will have sadly come too late and won’t touch the sides of the full financial impact of Covid on retailers, but for those who have been able to cling on, these small but necessary lifelines are a small glimmer of light at the end of this long, difficult tunnel.”
He added: “”As such, I’m pleased to see ongoing furlough and business rate support over the year which will help retailers recover, safe in the knowledge they can rebuild their financial stability steadily without sudden implications or the tough choice to make redundancies immediately upon reopening.”