Positive news for UK businesses in the Chancellor's Autumn Statement

Chancellor George Osborne has opted for a safe Autumn Statement, mostly re-affirming previous Government messages on the recovery and the UK’s growing economy. However, there were a number of positive announcements for businesses.

The Government is going to abolish national insurance contributions for apprentices under 25 years old, which will reduce overheads for businesses and make it easier for them to hire apprentices. Youth unemployment remains a problem in the labour market and this move will hopefully alleviate the issue.

Inflation-linked increase in business rates will be capped at 2%, which will be welcomed by businesses across the country. Even with the economy growing businesses are under pressure to keep their costs low and this announcement will be come as welcome relief to business owners. Also, small business rate relief as been doubled for another year.

10 main announcements relevant to businesses:

1. Abolish employer national insurance contributions for apprentices under 25.

2. Expand the British business bank and extend the funding for the lending scheme by a further year.

3. Research and development tax credit for small and medium firms will be increased by 23% and tax relief will be increased for large firms.

4. Small business rate relief doubled for another year.

5. Inflation-linked increase in business rates capped at 2%.

6. Retail discounts for high street businesses will be increased from £1,000 to £1,500 in 2015-16.

7. Employment allowance will be extended to carers.

8. Theatre tax break extended to orchestras.

9. New tax credit for children’s TV producers.

10. £45 million support package for exporters.

Labour has, however, accused the Government of having “failed every test” on the economy. The Labour leader, Ed Miliband, was critical of the Conservatives for pledging in 2010 to substantially reduce the deficit but failing to do so.

Overall, the Autumn Statement did not announce anything controversial but confirmed that economic growth has been strong in 2014, with a growth rate of around 3%. Furthermore, it reinforced current messaging that the recovery is coming to an end, economic growth has been strong but the deficit is still too high and average wages are not picking up substantially.