Budget: Industry Awaits Decisive Action to Boost Productivity
ADS welcomed specific measures announced by Chancellor Philip Hammond on R&D tax credits and business rates, but action to boost productivity is essential to boost UK competitiveness.
In the November Budget, the Chancellor announced:
- The R&D tax credit for large companies would rise to 12% – sending a signal that the UK is open for innovation, and encouraging aerospace and defence companies to invest.
- Business rates will be uplifted by CPI inflation rather than RPI from April 2018, two years earlier than planned, saving business an expected £2.3bn.
However, Office for Budget Responsibility forecasts for productivity growth have been revised down, highlighting the urgent need for decisive measures to support supply chain productivity growth.
ADS Chief Executive Paul Everitt said:
“Stagnating productivity is a national challenge. Addressing it is crucial to making sure UK companies can compete on the world stage in the years ahead.
“Businesses will welcome the Chancellor’s measures to incentivise private sector investment in R&D and minimise increases in business rates.
“However, Government must take decisive action to support supply chain productivity.
“Investment in productivity improvement programmes will support UK manufacturers to meet international demand for our high quality products and provide the best response to Brexit uncertainties.”