Businesses in Greater Birmingham will feel “a huge sense of frustration” after the Chancellor’s Spring Statement failed to tackle deep-seated issues.
The measures announced by Rishi Sunak included a cut in fuel duty by 5p a litre until March, 2023; a reduction in the basic rate of income tax from 20p to 19p in the pound; and the point at which people start paying National Insurance will rise to £12,570 in July. But business leaders remained disappointed that the Chancellor did not go further.
Henrietta Brealey, Chief Executive of Greater Birmingham Chambers of Commerce, said: “Did the measures announced in the Chancellor's statement go far enough to tackle the rising cost of doing business crisis? No.
"There were welcome elements to the measures announced such as raising the threshold for NI contributions and increasing the Employment Allowance. However, businesses are still faced with increasing costs from energy prices, talent and labour shortages, supply chain disruption, VAT for hospitality returning to 20% and rampant inflation with key sectors still needing time recover from two years of COVID-19 pandemic.
“Meaningful action cannot wait for next big fiscal event - the Autumn Budget. If the government is still serious about Building Back Better and Levelling Up it needs to back the wealth generators and engines of economic and jobs growth - our businesses."
Head of Policy at the GBCC Raj Kandola, said: “The fuel duty freeze will offer a short-term reprieve for many but is hard to reconcile with the Government’s longer-term commitment to sustainability.
“It was noticeable that the Chancellor chose to ignore the plight of those firms that are still suffering from the long tail of Covid-19. Further reform of the business rates system along with delaying the rise in levels of VAT would have given much-needed breathing space for those that are still faced with huge debts and overheads as a result of the pandemic which have been directly exacerbated by the events in Ukraine.
“The Chancellor was right to recognise the long-standing issues which act as a break on business investment and it’s heartening to see the commitment encouraging capital investment and greater uptake of R&D tax reliefs – we would urge the Chancellor to go further and expand the parameters of the Super Deduction Scheme to include digital assets as a starter for ten. As always we will work closely with the local business community to understand what these changes will mean and continue to lobby for support for those businesses that are facing a hugely uncertain future.”