Earlier this month the Government published the Budget for the 2016/17 financial year. The Budget and the Government recognises the important role that businesses in Essex and throughout the country are playing supporting job creation, investment and growth. Unemployment across the country continues to fall and the numbers of people in work is at a record high at 31.4 million. Since 2010, there are now 2.8 million more people working in private sector employment, the majority of which are in full time roles. The number of women in employment is also at a record high while the numbers of young people on unemployment benefits is also at its lowest level since the mid-1970s.
Although wages are rising, the economy is growing and unemployment is half the rate of the Eurozone, we cannot be complacent. This is why the Budget introduces new measures to help business to grow and create jobs.
Business rates, which are among the highest costs that businesses face, will be reformed. The Small Business Rate Relief threshold will more than double on a permanent basis from £6,000 to £15,000 and the Higher Rate threshold will rise from £18,000 to £51,000. This means that 600,000 small businesses will save up to nearly £6,000 and a further quarter of a million will see their bills reduced. Moreover, from 2020, Business Rates will be uplifted annual by the CPI inflation measure rather than the higher RPI measure. Small businesses and shops will particularly benefit from these reforms and this support for business is only possible because the economy is growing and is far stronger than it was in 2010.
Small businesses will also benefit from changes to Stamp Duty Land Tax which will mean that over 90% of commercial property transactions will incur less or the same charges. In addition, the Corporation Tax rate will fall to 17% by the end of the decade, which means that businesses will be able to keep more of the profits that they make and maintains our rates as the most competitive in the G20. In 2010, the Corporation Tax Rate was 28% and the Small Profits Rate was 21% with plans by the last Labour Government to increase it to 22%. By cutting these taxes, the Government has supported business growth, encouraged investment and brought in tax revenues to invest on public services.
As well as getting behind businesses, the Government has taken action in the Budget to support the self-employed and entrepreneurs. Class 2 National Insurance contributions are being abolished to help save self-employed people money and a new lifetime ISA savings account is being set up for people to save for the future and their retirement.
I know that thousands of local businesses, entrepreneurs and self-employed people will welcome these changes, which will make a positive difference to our economy and future prosperity.
More information about the Budget can be found online at:
If any local residents or businesses need help or assistance from me, or have questions about the Budget, they are always welcome to get in touch by email to: WithamMP@parliament.uk by post to: Priti Patel MP, House of Commons, London, SW1A 0AA, or by telephone on: 020 7219 3528.
Rt Hon Priti Patel MP
Member of Parliament for Witham