Doing Business with the UK
There appear to be no major changes to Business and Personal Tax rates or changes affecting the incentives available to companies setting up in the UK. With regard to research and development tax relief, a higher rate of relief will be available to a larger number of companies. In addition, the process of claiming relief will be simplified which should encourage more companies who are entitled to tax relief to make a claim.
Education
In order to close the gap between spending in state and private schools on IT, equipment, teaching materials and buildings, Gordon Brown said that annual investment in education will rise from £5.65 billion to £8 billion over the next five years, a 50 per cent rise making a total of £34 billion new investment over five years. He also announced an extra £440 million will go directly to school heads to pay for extra teachers and there will be a drive to recruit 3,000 new science teachers.
Transport
Gordon Brown announced that drivers with cleaner engines would have their road tax cut to just £40 while the "greenest" cars would pay nothing at all. A new top rate of vehicle excise duty of £210 will apply to newly purchased gas-guzzling cars. For the fourth year in succession fuel duty will be frozen while air passenger tax will also remain unchanged. Gordon Brown also announced free off-peak national bus travel for the over-65s.
Cigarettes and Alcohol
Gordon Brown put 9p on 20 cigarettes, 4p on a bottle of wine and 1p on a pint of beer. Duty on whisky, other spirits and cider will be frozen. He added that "in anticipation of World Cup success this summer, I am freezing duty on champagne ... and on British sparkling wine."
Economy
The UK economy grew by just 1.8 per cent in 2005, its weakest pace in 13 years. But a revival in consumer spending and the recovery of both the housing and share markets have helped restore confidence and Gordon Brown said GDP growth reached 2 per cent in the last quarter of the year. Economic growth remains on target at 2.0 to 2.5 per cent this year and would pick up to between 2.75 and 3.25 per cent in 2007 and 2008. Inflation was also on target, he added, as it had been since Labour came to power in 1997.
Sources:
www.tenongroup.com
www.timesonline.co.uk
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