Autumn Statement 2016: Business Announcements
Chancellor Philip Hammond has delivered his first Autumn Statement to the House of Commons.
The chancellor promised that the government would deliver an economic strategy that would “prepare our country to seize the opportunities ahead”.
Here is a summary of the main announcements relating to business:
Increased Infrastructure Funding
A 5 year National Productivity Investment Fund of £23 billion will be introduced to drive investment in infrastructure and investment. The fund will focus on the key areas of transport, digital communications, research and development (R&D) and housing.
Key areas of investment are:
- £2.3 billion to support the construction of 100,000 new homes
- £390 million in future transport technology such as electric and hydrogen buses
- £2 billion more per year in R&D funding by 2020/21.
Export Finance
The chancellor announced that UK Export Finance will be doubling and that the government will inject £400 million into venture capital funds through the British Business Bank.
Corporation Tax
The government will stick to its previous pledge to reduce corporation tax to 17%.
Business Rates
The transitional relief cap will be lowered to 43% next year and 32% the following year. The rural rate relief will be increased to 100%.
National Insurance
From April 2017, the national insurance thresholds for both employers and employees will be aligned at £157 a week. The chancellor estimated this will be an additional cost to businesses of £7.18 per employee.
Salary Sacrifice
From April 2017, employers and employees who make use of salary sacrifice schemes will be subject to the same tax as cash income. There will be certain exceptions, such as ultra-low emission cars.
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