Blog: The "Mini-Budget" and the Maritime Sector
On Friday, 23 September, the Chancellor announced in Parliament a series of measures in his new Growth Plan which included a package of tax cuts.
With less than 30 minutes of announcements, the Chancellor was brief and summed up what was a lot of headlines and little detail policy.
Kwarteng says his growth plan is based on “reforming the supply side of the economy, maintaining a responsible approach to public finance and cutting taxes to boost growth”. The Office for Budget Responsibility will publish an economic forecast before the end of the year and costings for today’s measures will be announced. The energy package is expected to cost £60bn in total in the six months from October.
Reforming the supply side of planning, business is key:
Investment zones: Investment zones were relatively the same as the 38 Areas pre-briefed and summarised in the press notice. The chancellor noted that Infrastructure planning reform is key (and new regulations will be enabled in a forthcoming planning bill). Priority is accelerating development in 40+ areas. This means 10-year extended tax relief for building, plants and machinery - commercial and residential - no stamp duty - no business rates - and employers won't pay national insurance for wages under 50k.
Stating: "We will cut taxes for businesses in designated tax sites for 10 years. There will be accelerated tax reliefs for structures and buildings and 100% tax relief on qualifying investments in plants and machinery and on purchases of land and buildings for commercial or new residential developments.
There’ll be no stamp duty to pay whatsoever on newly occupied business premises. There’ll be no business rates to pay whatsoever and if a business hires a new employee in the tax site, then on the first £50,000 pounds they earn, the employer will pay no national insurance whatsoever."
The Chancellor made no mention of Freeports.
- Scrap the planned rise in corporation tax from 19% to 25% in April, which had been set in motion by Rishi Sunak. This is a stimulation measure done as the Chancellor believes lower rates of taxation on company profits could encourage firms to invest in Britain.
- Investment tax - enterprise investment scheme extended.
- VAT free shopping in Ports, Airports and areas for retail for all tourists.
- As pre-briefed - the rise in national insurance introduced by the government earlier this year will be reversed from 6 November, while scrapping the new health and social care levy – a separate tax which was due to replace the national insurance rise from April.
- Stamp Duty - a new measure to increase the threshold £250K and increase threshold for first time buyers to £600k.
- Abolishing the additional rate of tax for high earners.
- Increases in duty rates for beer, cider, wine and spirits will be cancelled.
Details on investment zones here.
Zones have the potential to deliver against some key pillars of the Maritime UK Coastal
Powerhouse Manifesto, and engagement centrally and with relevant Local
Authorities will be key.