Commenting on the Pre-Budget Report and Comprehensive Spending Review of the Chancellor of the Exchequer David Kern, economic adviser to the British Chambers of Commerce, said:"As expected, the Chancellor revised down his GDP growth forecast for 2008 from 2.5 - 3.0 per cent announced by Mr Brown in the March Budget to 2.0 - 2.5 per cent. This is more in line with our own forecast of 2.0 per cent growth next year. However, there remains a risk that these figures will have to be downgraded further following the global credit crisis and the fallout from Northern Rock.
"Reflecting the lower growth forecast the Chancellor found it necessary to raise his borrowing figures for the next few years. This was expected but heightens concerns amongst businesses that further tax increases may be needed in future years.
"While the Chancellor repeated the announcement from the March Budget that corporation tax will be reduced to 28 per cent, we are disappointed that he did not take the opportunity to reverse the increase in small companies corporation tax announced at the same time."