Shropshire Chamber of Commerce says today’s autumn statement put a ‘really important focus’ on helping to promote business growth which drives success in the economy.
Chancellor Jeremy Hunt’s headline announcement was a 2% cut in National Insurance, taking the rate down from 12% to 10% in January for more than 27 million workers.
He also announced changes to National Insurance rates for self-employed business people, and ‘full expensing’ to make many investments fully tax-deductible.
Other headlines included a 9.8% rise in the National Living Wage, a commitment to retain the ‘triple lock’ for pensions, and a 6.7% rise in Universal Credit and other benefits from April.
The Chancellor also said his statement contained 110 measures designed to increase the UK’s productivity.
There was also a £50 million investment pledge over the next two years aimed at increasing the number of apprentices in engineering and “key growth sectors” where there are shortages.
Ruth Ross, Shropshire Chamber’s chief executive, said: “The British Chambers of Commerce asked the Chancellor to focus on key issues that impact business, including planning, full expensing, the energy grid, and business rates.
“We are delighted to see these reflected in his announcement – as well as a commitment to helping to solve issues around late payments, which disproportionately impacts the cashflow of many smaller businesses.”
She added: “A rise in the National Living Wage is clearly good news for lower-paid workers, but we must also be aware that businesses will be looking to pass on part of this by raising prices.
“It is estimated that abolishing class two national insurance, and changes to class four national insurance will save the average self-employed worker in Shropshire around £350 a year, which will be welcomed.
“Our local pubs, and the wider wine and spirits industry, will also be delighted at the freeze on alcohol duty, having taken a battering over recent years.
“Business investment is the lifeblood of local economies, creating jobs and supporting our public services. Smaller firms will be relieved to see a package of measures that alleviate the cashflow problems they face, such as continued business rates relief for hospitality, retail and leisure.”
Ruth added: “While the announcements today signal a step in the right direction for business investment and to stimulate growth, we now need to see the Government move quickly to engage with businesses in the creation of a long-term industrial and green energy strategy.
“This will give the confidence for businesses to invest and make full benefit of the tax deductions announced today.”
Tax changes announced in the autumn statement reduce the tax burden in the UK by 0.7% of GDP, according to the Office for Budget Responsibility.
Shevaun Haviland, director general of the British Chambers of Commerce, added: “We are pleased the Chancellor has listened to our calls to help businesses deal with the current economic challenges.
“Our Chamber network called on Jeremy Hunt to offer ‘much needed solutions to Britain’s investment problem’. Today’s statement provided some welcome remedies at a time when businesses of all sizes need certainty and security from the Government in the difficult months ahead.
“The decision to make full expensing permanent will be a boost to companies wanting to invest. Our research shows that 34% of businesses have already benefited from the policy, rising to 47% for manufacturers.
“We have long called for the electricity grid to be upgraded to help companies transition to net-zero. In our recent net-zero survey, more than a third of businesses told us they were not getting what they needed from the grid, in terms of energy supply and connectivity. If we can we reduce grid connection times it will make a big difference.
“We welcome the planning reforms and investment announced by the Chancellor today to help tackle this huge infrastructure problem. Businesses trying to invest in a low carbon future will now be looking for a speedier path to grid connection.”
She added: “The Government’s plans to support people back into work have the potential to help grow the economy.”