Budget 2012: Mixed business reaction to Budget
- 21 March 2012
- From the section Business
George Osborne said the Budget "unashamedly backs business", but the business community has given it a mixed reaction.
The Institute of Directors welcomed the cut in corporation tax, but said the chancellor had not done enough overall to help firms.
Computer games industry veteran Ian Livingstone was pleased with the news of tax credits for his industry.
Mr Livingstone, life president of Eidos, said it was "very positive".
Under the change to corporation tax, the basic rate will fall to 24% next month, down from the current 26%.
It will then be reduced to 23% next year and 22% in 2014. The rate for small firms will remain at 20%.
Simon Walker, director general of the Institute of Directors, said: "While any tax reduction is welcome, the chancellor has not done enough to free business from the burdens and barriers that are holding economic growth back.
"There was a bold move on corporation tax, but in the bigger picture, this is still not far enough or fast enough."
John Cridland, director general of the CBI, said the cut in corporation tax could "make a big difference".
"By seizing the opportunity to make sure our corporate tax system is more internationally competitive, he has sent a powerful signal to companies to invest, do business and create jobs in the UK," he added.
Mr Livingstone added that the introduction of tax credits for the video game, animation and TV production industries would "enable the UK to reclaim its positions as a world leader in games development".
"I'm delighted, we have been campaigning on this issue for a number of years," he said.
Brewer Chris Gill of Ascot Ales bemoaned the lack of any new support for the UK's micro breweries.
With no change to the current 2% per year above inflation rise in alcohol duty, Mr Gill said his industry was "being strangled by punitive taxation".
"To me, it is a national scandal," he said. "The real ale industry is a growth industry, a growth manufacturing industry, which should be applauded and encouraged."
Hotelier David Groocock, owner of St Maur Hotel on the Isle of Wight, was also disappointed in the Budget.
"I don't think it is going to make any difference to my business at all," he said.
"For firms of my size, micro-businesses so to speak, the big problem remains a lack of help from the banks."
Jenny Lees, owner of Herefordshire-based dental care equipment company Dentanurse, gave the Budget a "mixed reaction".
She said: "What does interest me is the new grants for firms exporting, and the lower interest loans for small firms. I am certainly going to look at both of those.
"But small firms could have greatly benefited from a but in business rates, and we got nothing on that."
A stand-out Budget announcement was the decision to reduce the top rate of income tax from 50% to 45% from April next year.
Accountancy group Ernst & Young said this was a "positive" development.
"The UK's arrivals lounges are likely to be booming next year as entrepreneurs respond to a far more positive message from the chancellor," said Chris Sanger, head of tax policy at Ernst & Young.
"The chancellor has put the substance behind his rhetoric; the UK is open for business."
The Federation of Small Businesses (FSB) said it was pleased with some aspects of the Budget.
FSB national chairman John Walker said: "We are pleased with some of the actions to cut the burden of red tape, help to get our young workers into employment, and measures to improve access to finance.
"But, to ensure that businesses can be properly supported and to bring together the measures that have been announced, we are disappointed that there were no plans to look into setting up a small business administration - a department to champion small firms at the heart of government with a cabinet level minister."
Economist Brian Morgan, professor of entrepreneurship at Cardiff Metropolitan University, said there "was much to applaud" in the Budget.
"I particuarly like the new financial support for exporters, the enterprise loans for youngsters, and the changes on tax," he said.
"Reducing the top rate of income tax should be applauded."