IoD press release Autumn Statement provides a significant boost to business investment
Responding to the Chancellor of the Exchequer’s Autumn Statement, the Institute of Directors welcomed efforts by the UK government to boost business investment.
In particular, the IoD welcomes:
- Making full expensing of capital expenditure a permanent feature of the UK tax system – an issue that the IoD has campaigned for since July 2022
- Planning system reform
- Establishment of new vehicles through which to channel pension investment into high growth companies
- Measures to promote foreign direct investment, including a concierge service for major foreign investors
- Creation of new investment zones
- Tax cuts for the self-employed
However, the IoD would like to have seen more substantive measures to address skills shortages, which are a key concern of its members. In addition, although the Chancellor slightly sweetened his reforms of the R&D tax credit regime, the new system will offer less support than the earlier scheme.
Dr. Roger Barker, Director of Policy at the Institute of Directors, said:
“This Autumn Statement was all about making full expensing permanent. This measure represents a significant reduction in the overall burden of business taxation, and is to be welcomed. According to our members, full expensing is already exerting a positive impact on investment decision making. Of firms with capital budgets above £1m, nearly a quarter have told us that they have altered their investment plans as a direct result of the policy. We had been calling on Government to make this policy permanent and are therefore delighted that the Chancellor has listened.
“We would like to have seen more substantive measures to address the problem of skills shortages, which continue to be a problem for our members. There was also little aimed at underpinning the business transition to net zero. However, planning and pensions reform, and an improved focus on foreign direct investment, will benefit the longer-term prospects of the UK economy.”
The Institute of Directors’ submission to the Chancellor ahead of today’s Autumn Statement, which sets out the organisation’s key policy recommendations, is available here.
The Institute of Directors made the case for 100% expensing in a letter to the Treasury in July 2022 (p.6 onwards) and again in its response to Budget 2023 in March.
