The aim of the coalition government is to create an environment in the UK favourable for the development of existing businesses and attraction of start-up companies. At the same time, the government aims at developing of the most mature tax system among the countries of G20. The idea is to achieve a new model of balanced and stable growth with help of a fairly competitive tax system.
Some of the provisions in the new budget affect small businesses. The most significant of them are listed below:
- Corporation tax will amount to 26% starting from April 2011 which completes another 1% cut, by 2014 corporation tax is expected to be 23%
rate relief holiday for small business enterprises is extended by one year which starts on October 1, 2011
- Micro-businesses and start-up companies fall within a moratorium that exempts them from new domestic regulation from April 1, 2011, the duration of the moratorium being 3 years
- 21 Enterprise Zones across England will enjoy simplified planning rules and tax breaks for enterprises; as of now 11 zones are determined and 10 more will be chosen based on bids of local areas