Last week’s Autumn Statement announcement introduced a large number of new measures for businesses that are expected to help grow the UK’s economy.
One of the main focal points of the statement was encouraging business investment, acknowledging its power to bring money back into the economy, create new jobs and increase use of UK manufacturers and suppliers. This came as Hunt explained the government’s perspective that the best way to revitalise the economy is not through higher borrowing and untargeted support but by creating the conditions for the private sector to thrive – removing barriers to investment and cutting business taxes.
Amongst the many measures for businesses that were announced – 110 to be exact – the Chancellor confirmed an extension to the Investment Zone regime for Greater Manchester. This week’s Tax Tuesday takes a look at what the Investment Zone extension means for our region.
Investment Zones are aimed at catalysing the private sector and creating a shared approach between government and industry. They allow businesses in specific locations to benefit from a number of tax reliefs, including Stamp Duty Land Tax relief, enhanced capital allowances, enhanced Structures and Buildings Allowance and lower employer National Insurance Contributions.
At the Autumn Statement, Jeremy Hunt announced that the government will double the flexible funding envelope for each investment zone, from £80 million to £160 million, by extending the programme and associated tax reliefs from five years to ten. In a decade’s time, this could raise business investment by £20 billion per year.
The Investment Zone regime aims to strengthen devolution in England, further empowering local leaders to make decisions that drive growth in their areas. Known for its role at the heart of the industrial revolution, it seems fitting that Greater Manchester’s Investment Zone will focus on advanced manufacturing and materials across Manchester, Salford, Rochdale, Bury, Oldham and the wider city region. Over the next decade, local partners expect the investment to help leverage £1.1 billion in private investment and to create more than 30,000 jobs in the region. As the extension was announced, the government unveiled anchor investments from First Graphene, Kadant, Werit and Hydrograph worth over £10 million.
The £160 million allocated to the Greater Manchester Investment Zone over the next ten years will fund new research innovation, sector-focused skills programmes, local infrastructure enhancements, and targeted business support.
Several other updates to business taxes were announced in the Autumn Statement last week, including the permanent extension of Full Expensing; merging the RDEC and SME R&D tax relief schemes; and freezing the small business multipliers for retail, hospitality and leisure properties for 2024/25.
To find out more about the business measures announced at the Autumn Statement, download our Summary Report here.