Budget break down

Posted on 16/03/2016 · Posted in Palm PR

In his eighth Budget, Chancellor George Osbourne has announced a raft of new policies that will affect British businesses operating in the Food & Drink industry. Here’s our breakdown of the most significant

  • Corporation tax to reduce to 17% in 2020
  • Business rates cut for all properties in England, with 600,000 small firms paying no rates so that the business rates burden will fall by £6.7 billion over the next five years
  • The higher rate of Capital Gains Tax cut from 28% to 20% and the basic rate cut from 18% to 10% from April 2016 (except for residential property and carried interest), and extend entrepreneurs’ relief to long term investors in unlisted companies
  • National Insurance contributions cut for 3.4 million self-employed people, by abolishing Class 2 National Insurance
  • Abolish the Carbon Reduction Commitment energy efficiency scheme and replace it, in a revenue neutral way, with an increase in the Climate Change Levy from 2019
  • The income tax personal allowance increased to £11,500 and the higher rate threshold expanded to £45,000 in 2017-18
  • Business Rates:
    • Small Business Rate Relief (SBRR) permanently doubled from 50% to 100% and the thresholds increased to benefit a greater number of businesses. Businesses with a property with a rateable value of £12,000 and below will receive 100% relief. Businesses with a property with a rateable value between £12,000 and £15,000 will receive tapered relief. 600,000 small businesses, occupiers of a third of all properties, will pay no business rates at all.
    • The threshold for the standard business rates multiplier to increase to a rateable value of £51,000, taking 250,000 smaller properties out of the higher rate.
    • From April 2020, taxes for all businesses paying rates will be cut through a switch in the annual indexation of business rates from RPI to CPI. This represents a business rates cut every year from 2020.
  • Fuel duty frozen, saving the average driver £75 every year compared to pre-2010 fuel duty escalator plans

However, one of the biggest changes will be the introduction of a so-called Sugar Tax on soft drinks. Read our blog on the policy here

Full details on the budget can be found here