Business rates for small firms to be cut
Business rates for small firms to be cut
Thursday 25th March 2010
The government has announced business rates are to be cut in an attempt to support small firms as Britain slowly makes its way out of recession.In his Budget statement on Wednesday, chancellor Alistair Darling said from October there would a reduction of the tax on businesses, equating to a tax reduction for half a billion small business in England.
An announcement was also made on changes to capital gains tax (CGT), with relief increased for entrepreneurs.
Mr Darling said: "First, business rates are a fixed cost from the moment a company moves into their premises.
"The Federation of Small Businesses say this is the third biggest cost after salaries and rents.
"To help fledging businesses set up, as well as existing ones, I have decided to cut business rates for one year from October.
"This change means a tax reduction for over half a million small businesses in England, 345,000 of which will pay no business rates at all."
On CGT he said: "I am also going to make it more attractive for wealth-creators and innovators to set-up their own businesses.
"To do this, I am doubling entrepreneurs' relief for capital gains tax.
"At the moment, the first million pounds of lifetime gains are taxed at a lower rate of ten per cent, rather than the main rate of 18 per cent.
"This threshold will now increase to £2 million, enabling entrepreneurs to benefit more from their effort and investment.
"And I can also confirm today that I am not increasing the main rate of capital gains tax."
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