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Autumn Budget and Spending Review 2021 - Government factsheet for business

Today the Chancellor Rishi Sunak delivered the Budget and Spending Review for 2021, setting out an ambitious package of investment in innovation, infrastructure and skills, which – in partnership with business – will deliver sustainable growth and put us on the path to a high-productivity, high-skilled, high-wage economy that levels up every part of the UK.

How will the Budget and Spending Review support businesses?

  • Extending the temporary £1 million Annual Investment Allowance cap for another fifteen months until the end of March 2023
  • Reducing the burden of business rates by over £7 billion over the next five years including by:
    • Freezing the business rates multiplier for another year saving businesses £4.6 billion over the next five years
    ▪ A new relief for retail, hospitality and leisure businesses worth almost £1.7 billion
    ▪ Almost £750 million for businesses to improve their properties and decarbonise
  • The conclusion of the business rates review will modernise the system by committing to more frequent revaluations – every three years instead of every five years
  • Alcohol duty will be frozen across the board
  • An extension of support for the aviation sector, through the Airport and Ground Operations Support Scheme – helping airports and ground handlers with their fixed costs
  • £245 million of tax relief for theatres, orchestras, museums and galleries across the UK
  • £42 million to support world-leading creative industries, providing business and skills development support for SMEs to scale up and providing bespoke support for the UK’s independent film and video game industries
  • Extension of the Recovery Loan Scheme for a further six months until 30 June 2022
  • Funding for the delivery of the Help to Grow Digital and Help to Grow Management schemes, helping 100,000 small and medium-sized enterprises to boost productivity
  • Reforming the UK’s tonnage tax regime to ensure the shipping industry remains highly competitive in the global market
  • Setting the Bank Surcharge at its new rate of 3%. The Government will also raise the annual allowance to £100 million to ensure that the tax system is supportive of growth within the UK banking market
  • To ease the temporary supply chain pressures, Vehicle Excise Duty for heavy goods vehicles will continue to be frozen and the HGV Levy suspended for another 12 months from August 2022.
  • Freezing fuel duty for the 12th consecutive year
  • Introducing a package of APD reforms that will bolster air connectivity within the Union, through a 50% cut in domestic APD (benefiting 9 million passengers) and further align APD with environmental objectives by adding a new ultra-long-haul distance band
  • Total spend on skills will increase over the Parliament by £3.8 billion by 2024-25, equivalent to a cash increase of 42% (26% real terms) compared to 2019-20
  • The first increase to employer led apprenticeships funding since 2019-2020 – it will rise from £2.5bn in 2021-22 to £2.7bn in 2024-25
  • Providing funding to quadruple the number of places on employer-led Skills Bootcamps and delivering 24,000 traineeships a year

How will the Budget and Spending Review help businesses to innovate?

  • Increasing public investment in R&D to a record £20 billion per year by 2024-25, representing an increase of around a quarter in real terms over the SR period
  • That includes £5 billion on health R&D over the SR period, including for genomics and to support the life sciences industry
  • Reforming R&D tax reliefs by expanding qualifying expenditure to include data and cloud computing costs and refocusing support towards UK-based innovation, targeting abuse, and improving compliance
  • Increasing support for business-driven innovation, with funding for core Innovate UK programmes to reach around £1 billion per year by 2024-25
  • Delivered through the British Business Bank, the Government is also:
    o Expanding the Regional Angels Programme by £150 million
    o Expanding programmes in the North East and South West
    o New funds in Scotland (£150m), Wales (£130m), and building on existing programmes in Northern Ireland (£70m)
  • £312 million to continue to fund the Start Up Loans Scheme, which will support up to 33,000 entrepreneurs by providing loans and mentoring for people starting a business
  • A £1.4 billion Global Britain Investment Fund to support new investment in manufacturing industries across the UK, including offshore wind, zero emission vehicles and life sciences
  • A new re-domiciliation regime making it easier for companies to relocate to the UK bringing increased investment and skilled jobs
  • Introducing a Scale-up visa in spring 2022 to attract the brightest and best global talent to the UK
  • Launching a Global Talent Network to bring highly skilled people to the UK in key science and technology sectors
  • Maintaining the DIT Global Entrepreneur Programme to bring more entrepreneurs to the UK each year

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