UPDATE 1-UK plans 11 bln stg business tax break in budget - Bloomberg News

Kitco Media
By Reuters
Published:
Updated:
Reuters
(Adds background) March 11 (Reuters) - British finance minister Jeremy Hunt will hand businesses a three-year tax break worth 11 billion pounds ($13.23 billion) by replacing the UK's investment allowance with a temporary measure in next week's budget, Bloomberg News reported on Saturday, citing a government official with knowledge of the matter. Hunt will limit the relief to three years and propose a permanent replacement in the ruling Conservative Party's manifesto before the next election, the report said. Under this replacement full-expensing regime, companies will continue to save 25 pence on their tax bill for every 1 pound invested, the report said. A previously announced increase in the headline rate of corporation tax, to 25% from 19%, is due to come into force in April.


"For the manufacturing industry... those capital allowances work, so I would say, we do want to bring down our effective corporation tax, the total amount people pay," Hunt said earlier today in a GB News interview, referring to measures which allow companies to offset capital expenditure against their tax bill. Hunt is due to present his budget on Wednesday. ($1 = 0.8314 pounds) (Reporting by Lavanya Ahire in Bengaluru; Editing by Tomasz Janowski and Mike Harrison)

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