WE applaud this Budget. The Chancellor has held his nerve – which is exactly what we wanted to see. Deficit reduction is an absolute necessity, and he is right to reject the siren calls to abandon it.
Businesses will be glad that George Osborne has continued the downward pressure on corporation tax. Britain must become the most competitive place to do business, and lowering taxes to 20 per cent will attract welcome investment from abroad and support businesses ambitions for further growth and job creation.
The new employment allowance to reduce the tax on employing people is a welcome boost for small firms which are working hard to grow. The private sector has done a huge amount to improve the employment figures, and it is right that government supports their efforts. This will help more people out of unemployment.
In addition, raising the personal income tax allowance progressively also encourages individuals back into work, so both sides of the employment contract are being helped.
The abolition of stamp duty on Alternative Investment Market shares is also a positive signal and will hopefully encourage more investment in these companies, which should benefit Scotland as it has a greater presence in that index than the FTSE-100.
The agreement to introduce Lord Heseltine’s single competitive pot of funding is welcome, allowing the funds to be managed at a local level to facilitate economic growth. The implications for Scotland are not known at this point.
We have long called for co-ordinated policies to encourage the development of a UK shale gas industry. The Chancellor is right to set attractive conditions for shale exploration – this will create thousands of jobs, and reduce our reliance on imports and, we hope, will make a big difference to Scottish companies.
The Help to Buy housing initiative which promises support for mortgages next year will provide a welcome injection to the struggling construction industry.
We also fully support the removal of the planned fuel duty rise in September, this is a boost to Scottish businesses and individuals at a time when the economic green shoots are still not yet visible and there are financial pressures on businesses from all angles.
• David Watt is executive director at the Institute of Directors Scotland