Enterprise zones offering businesses tax breaks and fewer planning restrictions have gone live across the West Midlands.

Local Government Secretary Eric Pickles announced that the enterprise zones were now fully operational this week.

New businesses will be offered discounts of up to 100 per cent rate relief for up to five years from the time they move into the zone, funded by the Government.

Enterprise zones in the West Midlands include the Black Country Enterprise Zone, where Jaguar Land Rover is buildings a £355 million engine plant on the i54 business park.

The first phase comprises 70,000 sq metres with a second expansion phase of around 65,000 square metres. The plant will employ 750 staff and is due to be in operation by 2014.

Firms in the Black Country Enterprise Zone will also be able to claim capital allowances of 100 per cent, allowing them to offset the cost of tools and equipment against profits and reducing their taxable profits

A separate enterprise zone in Birmingham city centre is expected to help bring in £8.7 billion of investment, according to the Greater Birmingham and Solihull Local Enterprise Partnership.

Birmingham City Centre Enterprise Zone includes 26 sites across the city centre in seven clusters at Westside, Snow Hill District, Eastside, Southern Gateway, Digbeth Creative Quarter, Birmingham Science Park Aston and the Jewellery Quarter.

Enterprise zones are a government initiative designed to help create private sector jobs. They provide businesses which move into a zone before the next election with a 100 per cent business rate discount worth up to £275,000 over a five-year period.

All business rate growth generated by the zone for a period of at least 25 years will be kept by local authorities to spend on infrastructure to support employers.

Local authorities can also apply for Local Development Orders to establish a simplified planning regime, while the Government will support plans to roll out super-fast broadband throughout the zones.

Andy Street, chairman of Greater Birmingham and Solihull Local Enterprise Partnership, said: “The planning, rates relief and IT benefits, combined with plans to create world class connectivity to national, European and global markets through the New Street redevelopment, airport runway extension and, in time, High Speed Two, make it easy to see how Birmingham’s offer to potential investors, both foreign and domestic, is being enhanced.

“We believe that if we can make the most of the zone, when all of the development is in place we can deliver a £2.8 billion per annum uplift to the economy and create 40,000 jobs.

“However, the benefits of the enterprise zone go far further than the 26 sites that feature in the plan and the businesses located within them.

“Indeed, they provide the opportunity to align the growth of the city centre with the wider economic geography of the local enterprise partnership area, meaning the benefits will be felt beyond the boundaries of the zone.

“Retention of uplift in business rates for the next 25 years will enable the Greater Birmingham and Solihull Local Enterprise Partnership to invest in infrastructure provision, such as access to finance, energy and transport solutions right across the local enterprise partnership area.

“Furthermore, it will also enable us to invest in business support, access to finance and skills development to enable our existing businesses – whether part of the enterprise zone or not – to grow.”

Mr Pickles said: “Local business and private sector commerce turn the wheels of our economy creating the jobs this country needs. This Government has set about fostering local enterprise and creating the conditions for businesses to thrive.

“This week our low tax, low regulation, enterprise zones with superfast networks are going operational with live deals and incentives now available to entice new companies to the area.

“We’ve planted these economic incubators all across the country to help accelerate growth, rebalance our economy with thousands of new businesses and local jobs in each location.

"Enterprise zones are set to become the crown jewels of how we make Britain the best place in the world to start and grow a business.”