Charlotte Burton, Senior Manager – Taxation Services at Ryecroft Glenton, Newcastle-based accountancy practice, said: “Some of the concerns people had about changes to capital gains tax and inheritance tax did not emerge and there are some positives to take out of the Spending Review. A total of seven new Enterprise Zones will be created in the North of England, and we look forward to more detail on that, while the extension of the Small Business Rate Relief scheme and the increase in the Employment Allowance will support growth businesses and job creation here in the North East.
“Additionally, the increased spending powers and control over business rates for local authorities creates an opportunity to directly support businesses and communities in a way that is based upon local knowledge and needs.”
Amanda Vigar, Managing Partner of V&A Vigar & Co (Darlington) LLP, said: “I have long been calling for HMRC to be dragged into the modern world in terms of communication with the people it is supposed to serve.
“In my experience, during the last few months, dealing with HMRC on behalf of my clients has become steadily more painful with atrocious levels of customer service and, even more worryingly, serious inaccuracies in their current online portal.
“I would go as far as saying that HMRC is no longer fit for purpose and I am not convinced that every individual and small business having their own digital tax account by the end of the decade will improve the situation unless there is a root and branch overhaul of the taxation service.”
Richard Kirk, CEO of PolyPhotonix, said: “The changes announced to Innovate UK funding, moving from grants to loans, is interesting but is not the full solution as peer reviewed research grants are seen as de-risking early stage investment.
“Whilst loans are entirely appropriate for later stage development work it could prove a hindrance for early stage research work. During early stage research, the ability to draw in external finance for match funding could be jeopardised by such a change, because by its nature it is a relatively high-risk investment. Investors know that for every million pounds of government research funding, through industry consortium partnerships with universities, it will take industry £63 million of private funding to get the results to market. Therefore, potential investors need solidity of finance at that early stage to boost confidence and get to a solid foundation.”
Jonathan Willett, a Director at Henderson Insurance Brokers Teesside office, said: “I welcome the move to bring forward reforms to crackdown on claims surrounding minor road traffic act personal injury claims(i.e. whiplash claims) which are difficult to disprove.
“The escalation in such compensation culture has led to increases in insurance premiums, including those for businesses that run company car and lorry fleets. Any measures that have the potential to bring these costs down are good for business.”
George Hardey, Associate and Head of Tax at Waltons Clark Whitehill said: “New enterprise zones for the North East and an extension of the existing zone in the Tees Valley are good news for many businesses and may help revitalise our region’s economy. This means companies can expect additional tax relief, although exact details aren’t available yet.
“There was no such good news for people looking to sell residential property. Future changes to Capital Gains Tax mean the disposal of property will have to be reported within 30 days, reducing the flexibility we currently have. This change should not affect gains on properties which are not liable for CGT, where the Private Residence Relief is available. Therefore Buy-to-Let landlords are likely to be the main group of property owners that suffer from these changes.
“Buy-to-Let landlords are also targeted by a further change which will see a 3% increase on the rates of Stamp Duty Land Tax on the purchase of buy to let properties though the acquisition of second homes will also be caught.
“Digital tax accounts for individuals and businesses, designed to modernise HMRC, mean significant changes in the way many people manage and pay their taxes. This could mean HMRC issue many more automatic tax calculations for individuals which of course should not be accepted at face value and should always be checked.”
Richard Hogg, Managing Director of Jackson Hogg Recruitment said: “The merger of Innovate UK with Research UK, and the move from grants to loans pose a risk for early stage innovative engineering businesses. With our economy in the North East in desperate need of reinvigoration, now is the time to be doing more to back innovation, not less.
“There was some good news for the region in the form of new Enterprise Zones and increased spending on infrastructure.
“The announcement that over a million new jobs can be expected over the next five years is good news for the country in general and for the recruitment industry in particular.”
Gillian Marshall, Chief Executive of the Entrepreneurs Forum, said: “The extension of Small Business Rate Relief will be welcomed by many North East entrepreneurs, although some may be unhappy that the review of business rates has been postponed.
“I am sure many businesses will be pleased to see the Entrepreneurs’ Relief Scheme has been not changed, as some commentators had predicted. Also, the announcement of new enterprise zones is positive news.
“The boost to apprenticeships announced today could also be good news for smaller businesses looking to train skilled employees.”