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Chancellor Rachel Reeves has warned her Budget on 30 October would be “tough” as she gave the clearest signal yet that businesses will face a hike in national insurance.
Ms Reeves insisted the difficult decisions in the Budget would not put off business investment in the UK because she would offer firms long-term certainty about the levels of taxation they will face.
Indicating that employer NICs were in her sights, she said: “We were really clear in our manifesto that we weren’t going to increase the key taxes paid by working people: income tax, national insurance and VAT and, on the business side of commitment, that we would cap corporation tax at its current rate of 25% which was the lowest in the in the G7 and we will stick to the commitments we made in our manifesto.
“But you know that there’s a £22 billion black hole over and above anything that we knew about going into the election that we need to fill, and that’s not just for one year, but that persists throughout the forecast period.”
She also pledged to end “years of instability” as she addressed business leaders at the Government’s International Investment Summit.
Government will “turbocharge” the UK Infrastructure Bank, Reeves says
The Government will “turbocharge” the UK Infrastructure Bank by converting it into the new National Wealth Fund, the Chancellor has announced.
Rachel Reeves told the International Investment Summit: “Today, we are creating the National Wealth Fund and making it the UK’s new impact investor.
The National Wealth Fund will catalyse tens of billions of pounds of private investment into clean energy and our growth industries, like green hydrogen, carbon capture and storage and gigafactories.
“From today, we are turbocharging the UK Infrastructure Bank, which will operate as our National Wealth Fund. It will be headquartered in Leeds with a bigger team, more freedom and an expanded suite of financial instruments and more economic risk capital to ensure that the National Wealth Fund’s investments can be even more catalytic.”
Government will cap corporation tax at 25% for the rest of the Parliament, Reeves announces
The Government will cap corporation tax at 25 per cent for the rest of the Parliament and set out a roadmap on business taxation to provide “certainty” for investors, Rachel Reeves has announced.
The Chancellor told guests at the International Investment Summit that the Government would “create a tax system that supports wealth creation and increases business investment”.
She said: “I know that providing certainty is right at the heart of that. The constant changes that we have seen in corporation tax in recent years have caused instability.
“So at the Budget, this Government will be outlining a corporate tax roadmap. We will cap the rate of corporation tax at 25%, the lowest in the G7, for the duration of this Parliament.
“We will maintain a world-leading capital allowances offer, with full expensing and the £1 million annual investment allowance, and we will maintain the current rates for the research and development reliefs which provide generous support for innovation.
“This is a vital step to deliver certainty and support businesses to grow.”
Reeves announces new British Growth Partnership within the British Business Bank
Chancellor Rachel Reeves has announced a new British Growth Partnership within the British Business Bank (BBB).
The partnership is expected to help bring institutional investors such as pension funds together with the BBB to make long-term, fully commercial investments by the end of 2025.
Encouraging British pension funds to invest more in the UK was a key goal of the previous government, and one the new Cabinet is also pursuing.
BBB chief executive Louis Taylor said: “By establishing the British Growth Partnership, the bank will encourage more UK pension fund investment into the UK’s fastest growing, most innovative companies.
“In addition, reforms to the bank’s financial framework, putting our £7.9 billion commercial programmes on a permanent footing, means we can flexibly reinvest our investment returns over the long term to increase growth and prosperity across the UK.”
Reeves pledges end of instability as she announces new National Wealth Fund
British economic instability has ended and the new Government is bringing investment and jobs back to Britain, the Chancellor has said.
In a speech closing Monday’s International Investment Summit, Rachel Reeves told the world’s biggest businesses they can look forward to “a true partnership” with the new Government as it works to boost growth.
She said: “When we said we would end instability, make growth our national mission and enter a true partnership with business, we meant it.
“The decisions which lie ahead of us will not always be easy. But by taking the right choices to grow our economy and drive investment we will create good jobs and new opportunities across every part of the country.
“That is the Britain we are building.”
Delivering on a manifesto promise, Ms Reeves announced that the existing Leeds-based UK Infrastructure Bank will be transformed into the National Wealth Fund (NWF) with £27.8 billion to invest in clean energy and growth industries.
David Davis chokes up in the Commons remembering Alex Salmond
David Davis has choked up in the Commons talking of Alex Salmond, who died suddenly at the weekend.
Although they had very different outlooks, the former SNP leader and the man who once vied to lead the Tory party were personal friends.
Commons speaker Sir Lindsay Hoyle also said that Mr Salmond left a “deep and lasting legacy”, as he led tributes to the former Scottish first minister in parliament.
Rachel Reeves set to take stage
Rachel Reeves is set to speak to end the International Investment Summit at 4:20 pm today. The chancellor will likely highlight the investments announced as part of today’s event, including the £1.1 billion for London’s Stansted Airport.
It’s unlikely any Budget measures will be unveiled by the chancellor, with around only two weeks until the event. However, Ms Reeves may take the opportunity to reiterate Labour’s central message of growth, needing to deal with the ‘inheritance’ of the previous government, and the tough decisions ahead.
Winter fuel payment row still hangs over government after 100 days
As Labour ministers greet business leaders with a celebratory mood, criticism continues from other sectors ahead of the new government’s first budget on 30 October.
Campaigners and charities are maintaining pressure on Labour to scrap or tweak the cutback of winter fuel payments to include more pensioners, as it is feared millions could miss out.
Social Affairs Correspondent Holly Bancroft speaks to a pensioner set to miss out on winter fuel help this year because she is just £3 above the weekly threshold for support.
Investment summit about more than Musk, Downing Street says
The Government’s international investment summit is “not about focusing on any one specific person”, Downing Street said when asked why Tesla owner Elon Musk had not been invited.
It has been suggested the billionaire was snubbed after engaging in a Twitter spat with Sir Keir Starmer during rioting in the summer, when he said demonstrators were subject to two-tier policing.
Asked why Mr Musk was not attending, the PM’s official spokesman said: “This summit is not about focusing on any one specific person.
“What you can see today is 300 of the most significant investors, people who can bring significant amounts of capital to the UK, attending this summit, which is obviously hugely significant.”
Greens criticise Labour’s deregulation drive
Ellie Chowns, Green Party MP for North Herefordshire, has criticised the prime minister’s promise to strip back ‘unnecessary’ regulation to boost investment.
She said: “Starmer’s pledge to investors that he will “cut red tape” is a tired cliché that, in practice, too often means harming environmental standards and workers’ rights. We’ve had fourteen years of successive Conservative governments promising to “cut red tape,” and all we have to show for it is a flatlining economy and falling living standards.
“If Starmer is serious about attracting investment to the UK, he will need a bolder approach that delivers on the “change” he promised in his election campaign. He could start by re-evaluating our relationship with our biggest trading partner, the European Union.”
Sadiq Khan: We “shouldn’t be scared” of EU single market
Mayor of London Sadiq Khan is also in attendance at Labour’s International Investment Summit today, where he has spoken to reporters about Britain’s relationship with the EU.
“I’m quite clear that all successful countries do the most trade with their nearest neighbours, that’s one of the signs of success,” he said.
“We’ve got on our doorstep, not just friends and colleagues and family indeed, we’ve got a market of more than 500 million people.
“The good news is the Prime Minister spent a lot of the last three months visiting friends in Europe, whether it’s the president of France, the prime minister of Italy, the chancellor of Germany or the European Union, indeed, in Brussels.
“The current Brexit deal we have comes up before review next year. I’m hoping, unlike last time, there will be closer alignment, rather than divergence.
“We should be looking at a whole host of issues and talking about them – whether it’s a youth mobility scheme, whether it’s seeing what we can do to bring people closer together.
“I think the reality is, in the short term, we probably aren’t going to get back as members of the single market. But it’s something we shouldn’t be scared to talk about.”
Source: independent.co.uk
