FinTech start-ups were given an extra boost today when UK Chancellor George Osborne, announced he was more than doubling rate relief for small businesses.
In Westminster this afternoon, Osborne said: “Today I am more than doubling small business rate relief, and I’m more than doubling it permanently.”
The Small Business Rate Relief (SBRR) will be doubled from 50% to 100% from April 2017.
The threshold is also being raised from £6,000 to £15,000 for the lower business rate, and from £18,000 to £51,000 for the standard business rate.
The reforms mean 6,000 small businesses will pay no tax, and 250,000 small businesses will have their tax rates cut in April 2017.
The announcement was met with cheers from the Conservatives in the Commons, as Osborne said: “This is a budget for small businesses.”
Mike Cherry, policy director at the Federation of Small Businesses explained Osborne has ‘heeded our calls’, by excluding some small businesses from tax rates altogether.
He said: “The combined measures announced on business rates – the single biggest tax cut in today’s Budget – will be viewed by our members as a welcome and important step on the road to fundamental reform.”
Simon Broch, CEO of buy-side services provider, Alpa Dealing, told The TRADE: “As a small business owner this budget was very much a case of ‘What one hand giveth, the other taketh away’. Whilst a reduction in corporation tax and rates is well appreciated, the cost of employing staff has increased.”
“The corporation tax incentives are unlikely to draw an international business to locate in the UK until the ‘Brexit’ issue is resolved. Foreign investment into the UK will also be on hold for the same reason as the short to medium term effect of a Brexit could see a devaluing of the sterling.”
Leader of the opposition, Jeremy Corbyn, responded to Osborne’s Budget explaining it had “unfairness at its core”.
Corbyn concluded: “This is a chancellor who has produced a Budget for hedge fund managers more than for small businesses.”