Crowe welcomes positive steps to encourage growth
Johnathan Dudley, Midlands and South West Managing Partner and Head of Manufacturing at Crowe has welcomed Chancellor Kwasi Kwarteng’s announcement in the mini-Budget.
He said: “My initial reaction is ‘wow’, particularly in the removal of the 45% higher tax rate. Clearly what this government wants is to encourage the high rollers and wealth creators to come to, or stay in, the UK.
“And we have an interesting alignment in the basic rate of income tax and corporation – both 19%.”
He said that scrapping the rise in corporation tax and National Insurance would be welcomed by businesses.
He added: “There has been criticism in some quarters for scrapping the cap on bankers’ bonuses, but it wasn’t really having much impact. And if they want to strengthen the City of London as a centre for international banking, it sends all the right signals. It’s a very clear defensive move in light of growing competition from the likes of Frankfurt.
“And the scrapping of the most recent IR35 reforms will be welcomed by sub-contractors, and the companies who will find it much easier to hire them now. The changes were very restrictive.
“It appears the focus is very much on identifying the barriers to growth. And the big push for housing and construction will have major benefits for manufacturing and the wider economy if the developers are buying their bricks and steel in the UK.”
He said he thought the current low-rate of the pound against the dollar was unlikely to prove a long-term problem.
“I can recall how low it fell after Britain fell out of the ERM in 1992; it actually provided a huge boost for growth.
“There is a lot of interest from the US in buying UK goods at the moment, including major capital items, and a low pound won’t hurt.
“It makes goods from China more expensive too – they usually want paying in dollars – and hopefully that would see more people buying goods from the UK rather than importing them.
“There is a lot of interest around the new Investment Zones, but the big question is where will they be? There is a strong suggestion that in the Black Country, where I am based, it will be along some kind of Wolverhampton to Walsall corridor.
“But the factsheet from HM Treasury shows them talking to the West Midlands Combined Authority rather than the individual local councils. A lot of the combined authorities seem to be involved, so are we seeing a shift in planning responsibility to these authorities and the Metro Mayors like Andy Street?”
Ross Prince, Partner at Crowe said: “I think we are seeing three main prongs in the government’s plan for growth: construction, strengthening the City of London as a global financial centre, and using lower tax rates to put more money in shoppers’ pockets to spend on the high street.”
Johnathan Dudley added: “Again, it’s important that what they buy is made in the UK rather than imported, if that money spent on retail is to help the economy grow.”
- Miriam Sherwood, Director, People Communications & Marketing, Crowe UK. Tel: (0)121 543 1900, email@example.com
Notes to Editors:
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Crowe industry recognition
- UK Member of one of the top 10 accounting networks in the world (International Accounting Bulletin World Survey 2021)
- Top charity auditor (Charity Financials Auditor Benchmarking and Charity Finance Audit Survey, 2009 – 2020)
- Ranked 5th in the AIM auditors ranking by number of audits (AIM Advisers Rankings Guide, January 2022)
- 9th largest audit firm in the UK (UK fee income of audit firms that audit PIEs – by fee income on audit, FRC Key Facts and Trends in the Accountancy Profession, Figure 33, July 2021)
- Risk Consultancy of the Year 2021 for the second consecutive year (InsuranceERM) – Crowe was recognised to be at forefront of two key areas of focus for insurers in 2020: operational resilience; and environmental, social and governance (ESG) issues, including climate change.
- Awarded Bronze for Accountancy Firm of the Year – Large (2020 Citywealth Magic Circle Awards)
- Global Mobility Provider of the Year (Global Payroll Awards 2020)
- Employment Tax Specialist of the Year (Global Payroll Awards 2019)