Budget 2020 - Reaction

This was the first Budget of the new government, the first Budget for 500 days, and the first Budget of Chancellor, Rishi Sunak MP. It followed a Bank of England interest base rate cut from 0.75% to 0.25% announced earlier on 11th March 2020.

The first Budget of a new Parliament usually involves some ‘difficult’ choices – removing any risks before the next election!

However, this one was clearly focused on one main issue – the coronavirus.  The Chancellor went straight to COVID-19 and promised to take whatever action was necessary to help support the UK economy, businesses, employers and the wider health and prosperity of the nation.

Infrastructure

The second Road Investment Strategy (RIS2) will spend over £27 billion between 2020 and 2025, including:

• investing £20 million to develop the Midlands Rail Hub
• £1bn Transforming Cities Fund, locally -
  • £79 million for Bournemouth, Christchurch & Poole, including four new cycle freeways and new bus priority infrastructure.
  • £57 million for Southampton, including new Rapid Bus links.
  • a further £117 million for Portsmouth City Region, Norwich and Stoke-on-Trent subject to further business case approvals.

Tax

Confirming that the headline corporation tax rate will remain at 19% in 2020, the lowest in the G20, the Budget ensures that the UK will continue to be an attractive place to do business while allowing the government to take action to address the most important challenges businesses face and increase funding for infrastructure and vital public services.

Structure & Buildings Allowances (SBAs)

As announced in their manifesto, the Chancellor confirmed the increase in the annual rate of the SBAs to 3% - which the government has assessed will provide over £1bn in additional relief for businesses by the end of 2024-25.

Scottish Food & Drink

The GREAT Britain and Northern Ireland campaign will fund a £1m campaign to promote the Scottish food and drink sector.  This will include additional trade promotion to increase awareness and change perceptions of Scottish food and drink exports, including Scotch whisky.

Further support for the whisky industry – included the government freezing spirits duty for this year and also allocating £10m for R&D spending to help decarbonise UK distilleries, including the whisky sector.

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