The essential 2015 UK Budget breakdown for businesses
With the chancellor’s 2015 Budget revealed this week, what effect will it have on UK residents and businesses?
In the run up to the Budget, Chancellor George Osborne promised ‘no giveaways and no gimmicks’. But has he done enough to persuade voters that all the books have been well and truly balanced, in what is likely to be his last chance to boost his reputation ahead of the election?
Here is a rundown of Wednesday’s announcements and how they will affect businesses.
Tax cuts for North Sea energy industry
It’s no secret that the oil and gas industry is still feeling the effects of the collapse in oil prices since June 2014, where prices had plummeted over 60 per cent at some points. Therefore, it’s no surprise that there were a number of boosts for this suffering industry in this year’s budget.
Taxes on the oil industry will see significant reductions. The petroleum revenue tax will be slashed from 50 per cent to 30 per cent, in order to support investment in older fields. The existing supplementary charge for oil companies will also be cut from 30 per cent to 20 per cent and backdated to January.
The chancellor hopes these measures - which are worth a combined cut of £1.3 billion - along with new government seismic surveys, will increase the production of oil in the North Sea by 15 per cent come 2020.
Beer, cider, spirits duty cut
The chancellor announced the third consecutive year of cuts to beer duty.
George Osborne said the last two years’ cuts of a penny on pints helped to create 16,000 jobs in the brewing industry, which is reason enough for another reduction.
The tax on beer is being cut by 1p per pint. There will also be a two per cent reduction on the duty of spirits and cider.
Business rates review
After businesses across the country came together to call for a wide-ranging review of the business rates system, the government launched its review days ahead of the budget.
“You can’t create jobs without successful business,” said George Osborne in his 2015 Budget speech. “As well as the right infrastructure, businesses also need low, competitive taxes.”
This hopefully means that companies with similar turnover figures around the country will end up paying the same business rates, instead of the amount varying, depending on location or size of premises.
This will ensure that more businesses will survive the first few years of trading, instead of battling with huge bills and struggling to turn a profit.