George Rafferty, Chief Executive of NOF Energy, said: “The Chancellor’s announcement demonstrates the importance of the UK oil & gas industry to the British Economy. Halving the supplementary charge and effectively removing the petroleum revenue tax should send a message to the international operator community that the North Sea is still viable location for investment.
“With between 12 and 24 billion barrels of oil still to be extracted from the UK Continental Shelf, the North Sea remains an important part of Britain’s energy mix. This improved investment environment, supported by the industry’s own efforts to improve operational efficiency and the supply chain’s commitment to developing technology-led solutions, has the potential to bring real benefits to companies operating in the sector and the wider UK economy.”
Commenting on the budget, Graham Robb, North East chair of the Institute of Directors said:
“This was a good budget for business and the self-employed, the cuts to small business rates will be welcome as will the reduction in corporation tax for all firms. In the North East the energy supply sector will be pleased that support is being offered to the oil and gas sector and businesses with delivery and transport costs will be pleased that the Chancellor wasn’t tempted to increase the rate of fuel duty.
“The Northern Powerhouse has also taken some steps forward, the HS3 project has always found favour with IoD members and upgrading east west road links is a priority we want to see addressed as soon as possible. Both these transport priorities were addressed in the Budget as was the important acknowledgement that educational gaps need addressing, we hope that the £20million being committed to meeting educational challenges is spent effectively.”
Penny Marshall, Regional Director for the Institution of Civil Engineers in the North East said: “The confirmed financial backing for vital transport projects in the North is excellent news. The next step should be to underpin this commitment with an integrated plan embracing a mix of ambitious, transformational projects alongside smaller scale investments. If the plan can be developed swiftly, it will maintain confidence in the vision and enable the benefits to be felt sooner.
“While the headlines are focussed on important large projects, the upkeep of our existing infrastructure – from flood defences to local roads – should not be forgotten. We await details on any local authority cuts and the impact on maintenance budgets, and will continue to encourage a shift from reactive patch-up work towards a ‘whole life’ approach to infrastructure investment.”
Chris McDonald, CEO, Materials Processing Institute, said: The Chancellor’s downward revision in the growth forecast is not unexpected, but this did seem to be a Budget that would help SMES. Through our SME Technology Centre and the Materials Catapult proposal we are discussing with Government, the Materials Processing Institute is supporting the growth of technology driven small businesses and we understand the barriers to growth that exist.
“The Chancellor’s announcement on business rates and on the future reduction in Corporation Tax will leave more funds available for small business to invest and grow their enterprises.
“The further news on tax allowances for micro businesses and start-ups should encourage greater entrepreneurial activity. It can create clusters of technology-focused micro-businesses that can grow around, and be supported by regional research and development facilities.
“We see this as positive for the materials, processing and energy sectors that we support and for the Tees Valley region, where we are working to attract and grow more SMES in these fields.”
Reacting to new measures announced by the Chancellor to encourage saving, Colin Fyfe, chief executive of Darlington Building Society, said:
“Anything that encourages people to save for the future is to be welcomed and the Chancellor announced a number of interesting schemes. The new lifetime ISA is a simple mechanism for younger people to save for their first home, their retirement and anything in between. The Government ‘bonus’ of £1 for every £4 saved should act as a real incentive.
“This, together with the raising of the limit for ordinary ISAs and the savings scheme for lower-paid workers, makes it a good Budget for savers.”
Entrepreneurs’ Forum Chairman Nigel Mills said: “I am pleased to see no changes to schemes that encourage investment in small business like SEIS and EIS. On the whole, this Budget delivers a number of opportunities for small and growing businesses, it is now up to the business community to take these and run with them. Business Rate reform will be a big help to smaller businesses, while the cut in Corporation Tax are an opportunity for all North East companies to scale up and create employment.
“The new £1,000 allowances for property and trading income could give some people the incentive they need to take their first step into the world of entrepreneurship. The Chancellor’s decision not to increase fuel duty a positive too, as it is estimated that this will save small businesses hundreds of pounds a year.”
Mohammed Bashir, founder of Boro Taxis, said: “There will be an enormous sigh of relief across the whole of the transport sector that speculation about a 2p rise in the level of fuel duty did not end up as one of the Budget’s money-raising measures.
“While fuel prices have fallen, the disproportionate amount of tax levied on petrol and diesel would have made a tax rise unjustified as well as being a real burden on those operating in the taxi, haulage and logistics industries.”
Amanda Vigar, Managing Partner at V&A Vigar & Co (Darlington) LLP, has welcomed the tax breaks being extended to small business. Amanda said: “Entrepreneurs and smaller enterprises form the lifeblood of the UK economy and, therefore, it was important that there were reliefs to establish a more sustainable economic base to support the small business community.
“An extension of the business rates relief for small companies, a reduction in company Corporation Tax and the abolition of class 2 National Insurance contributions will help bolster a spirit of enterprise and help people who have the courage and flair to be self-employed.”
Jonathan Willett, a Director at Henderson Insurance Brokers Teesside office, said: “Last year’s Insurance Tax Premium increase from six to 9.5 percent caused consternation across a wide spectrum of business sectors because, unlike VAT, IPT is a non- reclaimable tax.
“This time the Chancellor has side-stepped potential critics with the 0.5 percent rise by directing the extra money raised to pay for flood defence systems. However, there is concern that the latest increase could be another step towards bringing IPT in line with the 20 percent VAT rate, a move already made by other EU member states such as Germany and Holland.”
The founder of financial services firm Opencast Financial, based in Newcastle, has welcomed the Chancellor’s new measures to encourage saving.
George Osborne announced new incentives to encourage those under the age of 40 to start putting money away towards retirement along with getting onto the property ladder.
The measures, set to kick in from April 2017, mean anyone who saves in a new Lifetime ISA will get £1 from the Government for every £4 they save.
Opencast financial founder Joel Marks said: “These are sensible measures to encourage savings and investment. Anything that encourages long-term savings is to be welcomed.
“The complexity of the pensions system has been incredibly off-putting for many. Chopping and changing of policy and lots of headlines about how lifetime allowances are being reduced means many people have decided they aren’t going to put any money away at all either because they don’t understand it or they don’t feel they would be getting enough to see them through their retirement.
“While this new ISA does nothing to cut through the pensions’ confusion, what it does do is encourage some much-needed simple long-term financial planning.”
North East LEP board member and mayoral candidate Jeremy Middleton said: “The extra focus on improving northern schools is fantastic news. For the North East to reach its full potential we need to ensure our young people have the skills they need to get the jobs that exist. Moving all schools towards academy status can free up fantastic heads to create fantastic schools, but will only achieve limited results without a comprehensive programme of business engagement delivering work experience and careers guidance for each and every student.
“A number of other measures announced by the chancellor should be positive for the region. In particular improving our links to the North West by dualling the A69, and supporting our manufacturing sector with tax cuts for the energy industry. I was disappointed not to see protection for Newcastle Airport from potentially aggressive Scottish tax policies, and will continue to call for matching powers for the North East.”
Entrepreneur Gareth Thomas, Managing Director of precision plastic injection moulding firm Icon Plastics, of Eaglescliffe, said: “Many of the Budget announcements are a case of jam tomorrow rather than today. A case in point is the latest cut in Corporation Tax, which will not come into effect until April 2020.
“Companies that buy raw materials from Europe and pay in Euros are facing increased costs now as uncertainty caused by the forthcoming Euro referendum has hit the value of the pound.”
George Hardey, Head of Tax at Tees Valley based Accountants and Business Advisors Waltons Clark Whitehill, said: “The increase in the Personal Allowance and the threshold for higher rate tax will be welcome news to the vast majority of people, although in many households these savings will be partially offset by the increase in Insurance Premium Tax. Changes to how businesses will be taxed are a little more complicated but should be popular with small and medium sized firms, business rate reform has been expected for years.
“The Chancellor’s decision to tighten the leash on the much maligned one-man Personal Service Companies will be unwelcome in some quarters, but will be considered a welcome simplification of the tax system by others. Further changes to Stamp Duty Land Tax could be seen to target larger businesses but equally smaller businesses may benefit from it.”