Influential lobby group the Confederation of British Industry (CBI) has today called on the British government to cut red-tape and stifling taxes in this month’s Budget.
The CBI has set out a number of key targets in a letter to the Chancellor of the Exchequer George Osborne that it believes, if achieved, will stimulate British business and get the economy moving again.
Broadly in support of a number of the proposals set out by the coalition, such as economic growth zones, simplifying the planning system and extending the length of time until an employee can claim unfair dismissal, the business group wants the government to look again at certain areas like tax.
John Cridland, Director General of the CBI, wrote: “The 50p rate is a major barrier for mobile overseas talent and place us at a significant disadvantage vis a vis our competitors. A personal tax roadmap is needed to clarify this uncertainty with investors.
“The CBI also believes that the definition of business assets under Capital Gains Tax is too narrow and will constrain the flow of finance to start-ups.”
On Friday the British Retail Consortium (BRC) criticised the Northern Ireland Budget Statement for suggesting that larger and more successful retailers should pay more tax.
Retail was singled out in the announcement as a sector that could shoulder more of the tax burden but Director General of the BRC Stephen Robertson argued that this would hinder the growth which all of the UK so desperately needs.
“Retailers already pay the highest proportion of business rates of any sector. There’s no rationale for singling out retail ahead of other sectors such as banking or business services,” Robertson said.
“Retailers are planning growth across the UK, investing in town centres and employing an increasing number of people.
“It would be terrible to see Northern Ireland miss out on that growth as a result of the Northern Ireland Executive pursuing a policy which could make the country a less welcoming place to do business.”
With the UK economy shrinking by 0.6 per cent last quarter and reduced family expenditure impinging on retail sales, the government has been making clear that growth is now its major priority.
Another area the CBI highlighted as a drag on growth was energy prices and it called for the incentives dropped from the Carbon Reduction Commitment in the autumn Budget to be restored again.
Cridland continued: “Equally pressing, is the rise in energy costs that appears inevitable if we are to meet both our climate change obligations and the need to maintain energy supply in the medium term.
“In achieving these objectives, we need to minimise the impact on the competitiveness of energy users across the economy.”