The Autumn Statement: Our Response for the Peer-to-Peer industry
27th November 2015
On Wednesday this week George Osborne announced the latest autumn statement, a fiscal tradition which has been in existence since 1976. Whilst the Chancellor has already delivered two Budgets this year, the autumn statement introduced a range of new measures which will affect investors and business owners. The statement is likely to encourage business growth through reforms to corporation tax, expansion of enterprise zones and the growth of apprenticeships. Additionally, the key change for investors was Osborne’s introduction of a 3% stamp duty tax on second homes. The latter policy comes into being at the same time as the new P2P ISA, and is another signalling effect that could result in alternative finance becoming mainstream.
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An apprenticeship levy will be introduced from April 2017. This will be 0.5% of an employer’s payroll, for businesses which have a wage bill of more than £3 million. It is expected that this will result in the creation of an additional three million new apprenticeships by 2020. This is a positive move for businesses and the economy as it will result in new jobs being created with a firm technical foundation.
Expansion Of Enterprise Zones
An additional new 26 enterprise zones will be created across the UK. First introduced in 2012, they have so far supported over 500 businesses by allowing them to pay reduced tax rates and receive business support such as access to broadband. More than a third of the new Zones will be in the North of England, helping to grow the Northern Powerhouse, and reduce the North vs South divide.
Corporation Tax Reform
Previously Osborne announced plans to make the UK a more competitive environment for businesses by reducing corporation tax from 20% to 18% by 2020. In the autumn statement Osborne indicated his backing for the devolution of corporation tax in Northern Ireland. It is planned that the new corporation tax rate for Northern Ireland will be 12.5%, which will allow it to compete more competitively with the Republic of Ireland.
3% Stamp Duty On Buy To Let
From April next year buy to let landlords will have to pay 3% stamp duty on new houses. This is likely to have significant implications within the wider investment community due to this being another measure to dissuade investors from putting their money into buy to let property. As this new measure comes into being at the same time as the P2P ISA, this creates a huge opportunity for the alternative finance space.
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