Boris Johnson will pledge tax breaks to businesses in a bid to get them back on side following a Brexit process they “did not want”.
The Prime Minister will tell business leaders on Monday that the Tories will put an end to Brexit “uncertainty and confusion” if they are returned to power on December 12.
In a major General Election pledge, the Conservative Party said a Tory government would cut business rates, launching a fundamental review at their first Budget.
The party said they will increase the employment allowance from £3,000 to £4,000, providing a cut in National Insurance of up to £1,000 for more than half a million businesses.
Under the plans, the R&D tax credit rate will increase from 12 per cent to 13 per cent, which the Tories say will boost manufacturing and the professional, scientific and technical services sectors in particular.
They have also promised to increase the structures and buildings allowance (SBA) from 2 per cent to 3 per cent to increase the tax relief on the purchase, building or leasing of a structure.
“Big business didn’t want Brexit”
In a speech to business leaders at the Confederation of British Industry (CBI) annual conference on Monday, Mr Johnson is expected to say: “Let’s not beat around the bush, big business didn’t want Brexit.
“You made that clear in 2016 and this body said it louder than any other.
“But what is also clear is that what you want now – and have wanted for some time – is certainty.
“So that you can plan and invest, so you can grow and expand, so that you can create jobs and drive prosperity.”
He is expected to add: “Whilst you didn’t want it, the people did vote for it. And so it was for politicians to deliver it.”
Lay down a gauntlet
The Conservatives said the cumulative benefit to businesses of the changes to the employment allowance, SBA and R&D tax credits will be approximately £1 billion in 2022-23.
Mike Cherry, chairman of the Federation of Small Businesses, said: “These measures lay down a gauntlet to other parties, and we hope there will be more to come at this election.
“Actions to reduce the cost of employment and fix business rates should be complemented with clear commitments to tackle the scourge of late payments and help ensure the Government is helping the self-employed.
“For example, through introducing a ‘self-employment legislative lock’ and measures to help the self-employed have better access to maternity, paternity and adoption support, and mortgages and pensions.”
Robert Hayton, head of UK business rates at real estate adviser Altus Group, said: “The Government undertook a comprehensive review of business rates at the Budget in March 2015 publishing its response a year later.
“Essentially we will be going over old ground with the tough questions having already been asked albeit that review was fiscally neutral.
“Business, of all sizes, will however be delighted to hear of the commitment to lower the overall burden as we are far too reliant upon property for tax revenues with UK property taxes the highest across the European Union and the standard rate of tax at its highest level since 1990.”
The announcement comes as the number of manufacturing firms entering insolvency reached a five-year high.
There was a 7 per cent increase in the last year, to 1,466, said chartered accountants and business advisers Moore.
The rise is being driven partly by Brexit-related uncertainty and a broader slowdown across Europe, said the report.
Labour leader Jeremy Corbyn and Liberal Democrat leader Jo Swinson are also speaking at the CBI conference.
The conference comes after CBI director-general Dame Carolyn Fairbairn said Mr Corbyn’s nationalisation plans will “freeze investment”, and called on Labour to work with business.
She told Sky News’ Sophy Ridge On Sunday: “We look at the policies on the table and we have real concerns that they are going to crack the foundations of our economy.”
Meanwhile, the Daily Telegraph reported that Chancellor Sajid Javid has backed a new tax on landowners that would force them to help fund schools and hospitals and deliver more affordable housing.
The newspaper reported that in an interview contained in a book called Home Truths, Mr Javid said: “When I was communities secretary, we worked on a 50–50 split of the valuation between local government and landowners.
“The state is expected to create the infrastructure around new housing and that needs to be paid for, so 50–50 makes sense – this would be an efficient and morally justifiable tax.”