Chancellor George Osborne announced he is “more than doubling” the small business rate relief.
In today’s Budget announcement, Osborne said he is doubling small business rate relief from 50 per cent to 100 per cent.
“Businesses with a property with a rateable value of £12,000 and below will receive 100 per cent relief. Businesses with a property with a rateable value between £12,000 and £15,000 will receive tapered relief,” the Budget statement says.
The government will also raise the threshold for the standard business rate multiplier from a rateable value of £18,000 to £51,000.
The Chancellor said 600,000 small businesses would pay no business rates at all from next year and 250,000 have their rates cuts.
Osborne says: “This is a Budget for small businesses. Today I am more than doubling small business rate relief, and I’m more than doubling it permanently.”
Hitachi Capital chief executive Robert Gordon says: “We welcome these changes to simplify the outdated business rates system, which currently places a huge burden on the UK’s 5.4 million SMEs, the backbone of our economy.
“Reducing red tape and giving businesses clarity over the amount of tax they have to pay is fundamental at a time when many are struggling with an overly complex regulatory environment.”
Gordon says today’s announcement will give SMEs “crucial breathing space”.
He says: “To capitalise on these opportunities, businesses also need to ensure they are educated on alternative methods of funding to boost confidence, financial security and productivity in the short-term.”
The Chancellor has also introduced two new tax free allowances for “micro entrepreneurs” who rent their homes or sell services through the internet.