Reflecting on the fact that British Capital Gains Tax is one of the highest in the world, Osborne made the change amongst a raft of other pro-business policies.“The best way to encourage that is to let them keep more of the rewards when that investment is successful,” he said to the House of Commons. Alongside a cut to the headline rate of Capital Gains Tax, a reduction in the basic rate was also made. It will fall from 18 per cent to ten per cent. Capital Gains Tax is a tax on the profit when an individual sells or disposes of an asset that has grown in value. Officially, it is the gain someone makes that’s taxed, not the amount of money received. The changes will be introduced in three weeks, but the old rates will stay in place for gains on residential property and carried interest. “I am also introducing a brand new ten per cent rate on long term external investment in unlisted companies, up to a separate maximum of £10m of lifetime gains,” Osborne went on to say. “In this Budget we’re putting rocket boosters on the backs of enterprise and productive investment.”
Read more on he Budget 2016:
- Chancellor takes more high earners out of top tax bracket
- Are you one of 6,000 small firms set to pay no rates?
- George Osborne to cut corporation tax to 17 per cent
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