Commenting on today’s Budget, David Frost, Director General of the British Chambers of Commerce (BCC), said:

  

“Despite tight fiscal conditions, we are encouraged that the Chancellor has prioritised business growth and private-sector expansion alongside deficit reduction. “There are some real pro-enterprise moves in this Budget that businesses will commend. Reducing Corporation Tax rates by 2 per cent this year is a measure of real substance. We also welcome the Government’s desire to speed up tax simplification, and to remove the much-disliked 50p top rate of income tax. 

   

“Smaller companies in every corner of the UK will take heart from the Chancellor’s moves to cut fuel duty, maintain business rate reliefs for an additional year, and to exempt businesses with fewer than ten employees from new regulations.

   

“We have consistently pushed hard for growth in every region and nation of the UK. We warmly welcome the re-introduction of Enterprise Zones in England, and the Government’s decision to reward those who invest in new businesses across the UK, for example through the doubling of Entrepreneurs’ Relief.”

  

On Corporation Tax:

  

“Reducing the main rate of Corporation Tax by 2 per cent is a clear signal that the UK is open for business. We are pleased that the main rate will drop to 23 percent over the next four years. This shows ministers really are listening to businesses.”

  

On Regulation:

  

“We have warned for some time that the Government’s rhetoric on regulation has not been matched by real changes to benefit businesses. While we still have real concern over the amount of additional costs that businesses will face due to regulation over the coming years, regulatory exemptions for micro-businesses and the scrapping of poorly-designed legislation, such as dual-discrimination provisions, are modest steps in the right direction.”

  

On National Insurance:

  

“The Chancellor missed an important opportunity to give employers greater confidence by cancelling the remainder of the planned employer National Insurance Contributions rise. This would have given many companies a strong incentive to take on staff as Britain’s recovery continues.”

  

On Fuel Duty:

  

“Businesses and their employees have felt the pinch of rising petrol prices and demanded action on fuel duty. We welcome the moves on fuel duty announced today – and await further details on how a stabiliser will work in practice so that businesses can plan with confidence.”

           

On Enterprise Zones:

  

“The Chancellor’s announcement of 21 low-tax, low-regulation areas across England in the form of Enterprise Zones will boost our regional economies. The role of Local Enterprise Partnerships in designating and running Enterprise Zones will ensure that local business leaders are at the heart of the new policy. Beyond upfront incentives, the reinvestment of business rates locally is critical to boosting regional growth.”

  

On Business Rates:

  

“Unlike larger companies, small businesses are hit disproportionately by changes to business rates. Extending the small business rate relief holiday for another year will give many SMEs greater confidence and allow them to invest in growth rather than pay more to the Exchequer.

  

Unfortunately, the Chancellor did not maintain the £18,000 threshold for Empty Property Rates – and followed through on plans to drop this to £2,600. This will result in additional costs to hard-pressed businesses, especially outside the South East of England.”

Enterprise incentives

“Anyone who takes the risk of investing in a business should be able to reap the rewards. The doubling of Entrepreneur’s Relief to £10m, as well as improvements to the Enterprise Investment Scheme, will help bring more capital into promising companies.”

R & D tax credits

“Businesses must be compensated for the high cost of investing in research and development, so the increase in R&D tax credits for smaller companies is an important step. Ministers must now ensure that small businesses do not face complex bureaucracy when trying to apply for these credits or this policy will fail to help.”

Tax Simplification“The merger of Income Tax and National Insurance would be a huge simplification for employers and save countless millions in administrative costs. We have campaigned for this for years – and urge the Chancellor to pursue this aim. He must consult widely to ensure we get it right first time.” 

Air Passenger Duty“Chambers campaigned against the shift to a per-plane tax because it would disadvantage business at Britain’s regional airports. It is encouraging to see the Chancellor moving away from this policy, and his decision to drop the planned increase in APD this year.” 

Skills“I visit companies across the country that want to do more to help young people kick-start good careers. More apprenticeships are welcome, but they must be high-quality and easy for businesses to access. More funded work experience placements will also help many people get a first taste of life in the private sector.”  

Tim Hutchings, Chief Executive, Hertfordshire Chamber of Commerce & Industry said: ‘This is a good business for business, it will not solve all our problems overnight but it goes a long way to laying down a foundation for business growth over the coming years’ 

Commenting on the new forecast published today by the OBR, David Kern, Chief Economist at the British Chambers of Commerce (BCC) said: 

“While the OBR growth forecast is more realistic than the previous prediction in November, we believe it is still too ambitious. The new forecast assumes a strong recovery in the early quarters of 2011, and may not have fully taken into account the effect of recent global events on the UK.  “If the MPC raises interest rates in the next few months, this could put the growth forecast at risk, and add to the obstacles facing Britain’s recovery. Although the forecast beyond 2011 is also ambitious, it is more achievable, providing the Government’s new growth strategy is successful in removing barriers facing businesses. “However, we share the OBR’s assumption that Britain’s medium-term prospects will gradually improve over time, and that the rate of growth will increase in years to come. The new figures for public sector borrowing, which are broadly in line with the expectations outlined in last year’s emergency budget, are higher as the OBR rightly assumes weaker growth and higher inflation. We believe these predictions are realistic, but will only be achieved if the new medium-term growth forecast, which is still ambitious, is met.”