It was pipped as the 'most-leaked Budget of all time' and indeed, much of the smoke billowing about over the past week has cleared to show plenty of flames beneath. 'This Budget rewards work,' were George Osborne's opening words as he addressed the House of Commons today.
From the outset, it was clear that the Chancellor was keen to get the enterprise community onside: '[This Budget] unashamedly backs business,' he declared. Corporation tax has been cut to 24% with the intention of bringing it all the way down to 20% in the near future. The 50p tax rate, so loathed by entrepreneurs across the land, has been dropped to 45p as of next April (wealth creators will have a 'better late than never' response to the delay, no doubt).
And there's the National Loan Guarantee Scheme, providing small businesses with loans at a 1% discount to banks’ normal rates - £20bn in guarantees will be available in the new SME fund. The Enterprise Finance Guarantee scheme has been extended. An above the line R&D tax credit for all businesses was announced. And tax for small businesses will now be based on cash, but only up to £77,000 turnover (As MT deputy editor Andy Saunders pointed out: ‘That's not an SME it's a microbusiness...’)
Our digital muscle is being put on 'roids too, with a promise to give 90% of the UK access to super-fast broadband. And Osborne is exploring enterprise loans for young people, much like the university loan scheme now. Richard Branson, who was lobbying for this scheme, dropped us a note to say: ‘The country is full of gifted and enterprising people so this pilot, which crucially has business mentoring and support at its heart, will help prevent a lost generation of talent.’
All well and good – he made a decent stab at producing a budget for growth despite the fact that his wriggle room was pretty limited. But unemployed graduates and school-leavers might be feeling a bit left out of the party.
But while business was vaunted and encouraged, superficially at least, the banks and the very wealthy were much maligned in this Budget. The new business tax rate does not apply to banks, said the Chancellor. And he directed a fair amount of wrath towards rich tax-avoiders: some £16bn of income has been deliberately shifted into the previous tax year at a cost to the taxpayer of £1bn, he reckons. But tax avoidance is one of those evils that can never quite be rooted out. As long as people have the cash to pay someone clever to work out how to dodge tax, they probably will.
So not the most exciting budget ever (are any of them?) but he managed to pull a couple of small rabbits out of his hat. Some positive stuff: Osborne confirmed that the Office for Budget Responsibility has revised growth predictions to 0.8% and 2% next year – but then we already know that. Well, this is the most leaked Budget ever… MT panellist, Michael Oliver, founder of Oliver Valves said: ‘I think there were some good headlines for the Coalition no doubt but welcome words for entrepreneurs, business and manufacturers. Let’s see them transferred into action.’ And David Buttress, MD of takeaway business Just-Eat added: ‘A tough budget to balance against such a tough economic background.’ But words are all well and good. What business wants to see is action. Let’s see if George can get the ball rolling on his promises, and quickly…