The Government’s economic policy objective is to achieve strong, sustainable and balanced growth that is more evenly shared across the country and between industries.
This requires the economy to be rebalanced towards exports and private sector investment.
The Government has already taken action to reduce the deficit and provide a stable economic environment – which is essential for sustainable growth – and to drive private sector led-growth.
The Budget builds on this with a package of measures that support private sector investment, enterprise and innovation:
- a reduction in the main rate of corporation tax by a further one per cent. From April 2011, the rate will be reduced to 26 per cent with further yearly reductions of one per cent until 2014 when it will reach 23 per cent;
- new Controlled Foreign Company rules to allow groups based in the UK to compete more effectively with those based overseas;
- the abolition of 43 tax reliefs whose rationale is no longer valid – following recommendations from the Office of Tax Simplification;
- dropping existing proposals for specific regulations which would have cost business over £350m a year;
- £100m for local authorities to repair potholes caused by the cold winter weather;
- increase the rate of R&D tax credits for small and medium-sized enterprises from 175 per cent to 225 per cent by April 2012;
- a new presumption in favour of sustainable development, so that the default answer to development is ‘yes’; and
- 21 new Enterprise Zones, to focus growth in specific parts of the UK.
Find out more about the Government’s Growth Review and download the Plan for Growth document