Poorest areas will be given new stamp duty break
Enterprise
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Your support makes all the difference.A package of measures to promote enterprise in Britain's 2,000 poorest areas was announced yesterday as the Government decided that businesses need more help to overcome barriers in these communities.
The Government said its enterprise policy recognised that social attitudes, the business environment and specific market failures can present "significantly higher barriers" in the UK's most deprived areas.
Gordon Brown said: "This pre-Budget report demonstrates the Government's commitment to promoting and supporting enterprise across society, and particularly within disadvantaged areas, changing attitudes to enterprise – from the classroom to the boardroom and tackling the difficulties entrepreneurs can face in starting and growing their businesses."
To try to tackle "acute" barriers, the Government had already designated 2,000 Enterprise Areas, covering the most deprived parts of the UK. These areas, which already benefit from a series of supporting policies, are spread across the country but are concentrated in Northern Ireland, Wales, London, the Midlands and the North-east. Mr Brownannounced a further package of measures yesterday.
The Government had already announced that Enterprise Areas are exempt from stamp duty for all property transactions up to £150,000. Yesterday, Mr Brown said he hoped to get approval in January from Europe to extend the exemption to all commercial property transactions
The level of stamp duty on transactions between £250,000 and £500,000 is 3 per cent, rising to 4 per cent for bigger deals. Below £60,000 stamp duty is nil and it is 1 per cent between £60,000 to £250,000.
Michael Quinlan, tax partner at Deloitte & Touche, said: "Four per cent is a big cost for a commercial development ... this could be the crucial factor in deciding where to locate a development."
The Government will introduce legislation to allow the setting up of business planning zones, giving local authorities new powers to streamline the system of planning obligations. The zones "will be particularly attractive to local authorities in the Enterprise Areas," the Government said.
Other benefits for Enterprise Areas include a package of support for employers from the Inland Revenue. There will be grants of up to £30,000 from the Business Incubation Fund to cover 70 per cent of the costs of feasibility studies for incubator projects. A new tax incentive aims to encourage donations towards the running costs of "urban regeneration companies", public-private partnerships to promote renewal in urban areas.
Another proposal will allow local authorities to retain additional increases in business rates revenue to spend on their own priorities.
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