The BPIF blasted the Budget, describing it as a “kick in the teeth” for printers and pointing out that, despite the cut in corporation tax, firms would be hit by the decision to cut tax relief on capital investments.
Andrew Brown, BPIF corporate affairs director said: “There is little for printers to celebrate in the Budget.
“The double whammy of increased corporation tax payable by small firms and the cut in capital allowances is a real kick in the teeth for our members. It will further erode their profitability as well as make it harder for them to invest in new equipment and technologies.”
But Brown (pictured) added that there was increased support for skills training and more tax relief on long-life assets.
The Budget reduced corporation tax by 2% to 28% but tax relief on capital investment has been reduced from 25% to 20%, affecting companies investing in kit.
The Small Companies Tax rate has also been upped from 19% to 20% from April. By April 2009, the figure will increase further to 22%.
Amicus assistant general secretary Tony Burke added that he was disappointed there was little focus on training.
He said: “On skills, while there was no response to the Leitch Review, the Government will need to ensure that funding for skills increases for the future and do more to make sure employers play their part.
“He [the Chancellor] announced increases in employment, but many of the jobs being created are in the service sector and cannot replace those well-paid, skilled jobs in manufacturing.”
BAPC chairman Sidney Bobb added that the Budget was neutral for the print industry. “I would say that the Chancellor hasn’t done any favours for small businesses. What he gives, he then takes away,” said Bobb.
BUDGET HIGHLIGHTS
• Corporation tax reduced from 30% to 28%
• Tax relief on capital investments to 20% from 25%
• Small Companies Tax Rate increased to 20%. By 2009 it will rise to 22%
• 2p a litre rise in fuel
• Income tax cut by 2%
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