Autumn Statement 2016: What it means for UK start ups
23 November 2016
There has been a huge amount of political change since the Chancellor's last budget in March and today's Autumn Statement is the new government's first opportunity to set out their intended tax landscape.
The buzzword of today's speech was Innovation, with the government putting the emphasis on the productivity challenge and recognizing that supporting innovation is key to the UK maintaining its growth and job creation. The new National Productivity Investment Fund will provide an additional £2bn a year for supporting R&D, but beyond some comments about allocating funding and grants to research and innovation, we're not sure yet exactly where this will go and on what terms. In addition, the government have said they will review the R&D tax environment with a view to building on it, but no specific measures yet.
Another pertinent issue for fast growth companies is funding. The government has promised an additional £400m investment to Venture Capital to unlock funding for innovative, scaling firms. The Chancellor announced this as an incentive to support businesses to scale rather than sell up before they have reached their full potential, but with the OBR report commenting that business investment had slowed due to the current uncertainty, this may be at least a partial replacement rather than new funding. There's also going to be some FinTech support and a new report on key metrics on the FinTech industry for investors, again on point because of uncertainty on how Brexit will impact Fintech and passporting.
Aside from this, there wasn't much affecting fast growth businesses - some amendments to the National Insurance thresholds and a continued commitment to the business tax roadmap to reduce headline rates of corporation tax and relieve the burden of business rates, which is always welcome for growing businesses. There was also the removal of the Employee Shareholder Status, but for many fast growth companies this had been something that was below EMI on their list of reward structures anyway. Finally, more emphasis on devolution - it will be wonderful to see tech development supporting economic growth throughout the whole of the UK and this is a great opportunity and time to do this.
Follow our analysis and reaction here: https://www.pwc.co.uk/autumnstatement