The most significant of these was the increase in the threshold for business rates relief from £6,000 to £15,000. This is expected to benefit an estimated 600,000 small businesses, particularly the small High Street retailers, many of whom will no longer have to pay business rates.
Given that many small retailers have been under extreme pressure from the rise of online retail, this will hopefully level the playing field at least somewhat as will another budget measure, a crackdown on foreign firms selling products online in UK without paying VAT.
The Chancellor calculated that this measure would save them around £7 billion per year.
To offset this loss to the Treasury another crackdown on tax avoidance was announced. This was aimed at reducing the scope for larger business to reduce tax by treating debt interest as a cost or by rolling over historical losses.
Another potential boost for SMEs?
There was help, too, for entrepreneurs with an extension to Entrepreneur’s Relief by which all long term investors who hold onto shares in unquoted trading companies for at least three years will now be able to claim the 10% reduced rate of Capital Gains Tax (CGT) on the sale of their shares.
Time will tell whether this will encourage more investors to switch from property investment, which is subject to a CGT rate of 28% on sale, to put more of their money into private companies. If so, again it will be small businesses that will benefit.
Other business-friendly measures included a reduction in the headline rate of corporation tax from 20% to 17% by 2020.
Dr Adam Marshall, Acting Director-General, British Chambers of Commerce, welcomed the support for small businesses and entrepreneurs: “He has finally taken real action to lessen the crushing burden of business rates, and sharpened incentives for entrepreneurship and investment.”