Business leaders in the West Midlands have welcomed the Chancellor’s decision to cut the top rate of income tax and corporation tax as a recipe for growth and job creation in the region.
Birmingham Chamber of Commerce Group (BCCG) said the cut of the 50p income tax rate by 5p will in 2013 send all of the right signals to encourage investment and job creation in the UK and slow the drain of talent to other countries by ensuring UK plc remains internationally competitive.
Michael Ward, the BCCG’s president, said: "The reduction of the top rate of tax is a bold measure to restore and protect UK plc’s international competitiveness.
"It’s a signal that the UK is indeed ‘open for business’ putting us on an equal footing with Germany, France and other competitors for talent and foreign investment.
"We applaud the Chancellor for recognising the importance of entrepreneurs to the economy, and more importantly, for further incentivising businesses to grow and create the wealth and jobs which will keep the economy moving.
"The reduction of Corporate Tax to 24 per cent from next month will provide a shot in the arm for businesses and enable them to accelerate much-needed growth. We are delighted the Chancellor has responded to the Chamber’s calls to reduce it even further to 22 per cent by 2014.
"Another aid to business growth will be the Chancellor’s announcement that ultra fast broadband and wireless would be rolled out in Birmingham and other major cities.
"The extension of Sunday trading for eight weeks across the period of the Olympics will be a boon in Birmingham, which will host the US track field team and the Jamaican contingent."
The Chamber reaffirmed its support for the government’s deficit reduction plans and said Mr Osborne’s budget was on track to hit his target to eliminate the structural deficit by 2016-17.
The BCCG welcomed the Chancellor’s plans for press ahead with controversial reforms to Britain’s planning system.
Mr Ward said: "Although environmental groups will fear the destruction of rural England, the decision to introduce a presumption in favour of sustainable development is the right thing to do."
However, BCCG said the Chancellor could have gone further to cut the burdens on business and aid employers to tackle skills gaps and youth unemployment which will undermine recovery.
Mr Ward added: "We would have liked to see further measures to encourage businesses to take on apprentices and measures to cut red tape, which are such a burden particularly for SMEs.
"We were disappointed by the Chancellor’s comments on the upcoming aviation review and delivering the capacity that the UK’s aviation market needs.
"We feel that the chancellor should have given clearer indications that the government will back airports like Birmingham Airport, as a solution to delivering the capacity that the UK needs.
"This approach is cheaper and more immediate than the alternatives and offers us the opportunity to rebalance our economy by making our regions magnets for foreign investment.
"We had also hoped for encouraging words from Mr Osborne on HS2. The planned high speed rail link between London and Birmingham is vital for the long-term relief of economic growth in the region.
"We feel that the Chancellor should have signalled to the world that the UK is confident and open for business by finding the funding to build the entire HS2 Y-Network at once.
"Treating HS2 as two separate projects creates needless delays and bogs HS2 down in the all too familiar mire of planning and bureaucracy that often kills infrastructure investment at birth."