Members of the British business community have welcomed the latest tax promises made by Prime Minister David Cameron ahead of next year’s election in May.
John Cridland, Director-General of the Confederation of British Industry (CBI) and John Longworth, Director-General of the British Chambers of Commerce (BCC), have praised the new tax measures proposed by Mr Cameron at the Conservative Party Conference.
Key messages in Cameron’s speech included that his party would raise the tax-exempt threshold to £12,500, from £10,000, and raise the threshold for the 40 percent income tax rate to £50,000, from £41,866.
The Prime Minister said that the rise in foreign companies investing in the UK was not a coincidence, but was because the UK was “rolling out the red carpet for them” by cutting red tape and taxes. He promised that the next Conservative Government would be the most competitive corporate taxes in the G-20.
Mr Longworth of the BCC said: “The Prime Minister was right to make the link between a competitive business environment, a strong economy and the resources available for delivering the public services people across Britain want.
“The continued commitment to balancing the books is absolutely right, as are the income tax cuts for promoting work, enterprise, and aspiration.”
He said keeping corporation tax low was important to the UK’s competitiveness, but so were all taxes businesses paid before making a profit. He said in order to have competitive tax system; the Government must reduce and reform business rates, which remain the highest in Europe.
Since the speech he has also introduced additional proposals that include a larger tax free allowance following the passing away of a loved one, which could have an effect on succession planning for family businesses.
Meanwhile, Mr Cridland of the CBI added that tax measures would provide stronger incentives for people to enter employment.
He said: “We need more investment to create more jobs, so pledging to keep the UK corporate tax rate the most competitive in the G-20 will send out a clear positive signal to businesses.”