In a letter to George Osborne, the CBI calls on the government to focus on three critical areas: boosting export performance; unleashing domestic investment spending; and removing barriers for high-growth firms. The CBI’s proposals include: creating a new corporate bond market for mid-caps to increase the supply of capital; speeding up the planning system to stimulate infrastructure investment and encouraging companies to become more energy efficient by restoring the incentive element of the Carbon Reduction Commitment.
The CBI says this year’s Budget, due on March 23, must also address areas of taxation, which are discouraging entrepreneurship and undermining UK competiveness, including the 50p personal tax rate and the narrow definition of business assets under Capital Gains Tax. “This Budget must demonstrate a relentless focus on growth to help get the UK working again,” comments John Cridland, CBI director-general. “We need an all-action Budget which boosts exports, investment and jobs. The Budget should create the framework for a Mittelstand of mid-cap businesses by ensuring they can access the capital they need to expand at home and abroad. “Mobile talent needs a good reason to do business in the UK, so the Chancellor should signal a road map for reducing the 50p tax rate. “The incentive behind the Carbon Reduction Commitment must be restored to help companies go green, and if not, it should be stopped altogether because in its current form it adds yet another cost to doing business. Cridland continues: “And we want to hear more about how the planning system will genuinely deliver swift decisions on infrastructure, and less about abolishing the Infrastructure Planning Commission.” Specific recommendations include… Boosting exports:
* Pushing ahead with making ECGD more accessible to smaller exporters. * Strengthening UKTI by ensuring it is supported across Whitehall departments and can fully exploit new markets for UK businesses. Stimulating investment:
* Ensuring the fast-track planning system delivers timely consents for strategic infrastructure. * Encouraging the development of the medium-sized corporate debt market to boost business growth. * Improving the Enterprise Investment Scheme (EIS) to bridge the funding gap for larger SMEs requiring £2m and £10m. * Piloting Growth Zones to attract investment.
Creating new jobs: * Avoid re-localising the Uniform Business Rate to avoid risk of increasing business costs.
* Extend the qualifying period for unfair dismissal and reform Employment Tribunals to boost job creation. * Restore the incentive of the Carbon Reduction Commitment or stop the scheme to reflect concern about energy costs. * Promote more competition in public service delivery.
Read the CBI’s full Budget submission here.
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