What the Budget means for Bristol

By Allister Weir

For the South West’s 3,000 dynamic mid-market businesses, the Budget was regrettably neutral.

Yes, announcements from the Autumn Statement around National Insurance contributions for the younger workforce and apprentices were confirmed. And decisions around maintaining the Annual Investment Allowance at its higher level of £500,000 per annum were delayed until the Autumn Statement later this year.

There were also tweaks to assistance from UKTI on exports.  And the long awaited review of Business Rates is to be welcomed as well. But overall, many measures that could really liberate growth amongst the mid-market were put off.

The Budget announcement covered many topics affecting mid-sized businesses in the UK. Below is my pick of the key areas that will affect organisations Bristol’s businesses in particular.

Investment in transport

Many feel that Bristol’s economy is being held back by its poor infrastructure and our road and train links in particular are essential to make businesses competitive. The announcement of the £7bn transport investment for the South West is a welcome one. For businesses to thrive we need our residents, workers and tourists to be able to get around this large, geographically dispersed region.

Boost for cider industry

Bristol’s fast growing segment of microbreweries and cider makers will welcome the Chancellor’s announcement of reducing the duty on beer and cider, along with the freezing of the petrol duty. Whilst there has been a round of cheer from the alcoholic drinks industry, we were also hoping to see the Chancellor encourage the soft drinks majors to innovate and come up with new ideas to reduce the sugar content in soft drinks.

Support for British exporters to China

The increase in support from UKTI on exports are welcomed, but do not go far enough to support mid-sized businesses. The South West has the potential to be an exporting hot spot, with world class products, especially in the food and beverage space. Despite this, the region still holds a place as one of the lowest exporters in the UK, according to HMRC data. Whilst there has been some growth, and efforts by organisations like Business West to support this, there is still some way to go before the region reaches its full potential.

Looking ahead

Whoever forms the government after the next election needs to act quickly in their first Budget, to stimulate exports, encourage further investment in innovation and skills, and critically simplify the tax regimes we operate within, for example a move towards harmonising the starting point for National Insurance contributions with that for income tax – a measure that would take many lower paid out of all taxes.

Allister Weir is Tax Partner at Grant Thornton in Bristol. Grant Thornton is one of the world’s leading organisations of independent assurance, tax and advisory firms.