Jeremy Hunt called it the “largest business tax cut in modern British history”, a view that may not be shared by the hundreds of thousands of businesses in the service sector that don’t spend large sums on capital investment every year and are still adjusting to April’s general hike in corporation tax from 19% to 25%.
But so-called “full expensing” of spending on equipment, plant and machinery – or, rather, the making permanent of a tax-break that previously had a three-year life – can be welcomed by everybody else. A permanent regime looks the only one capable of improving the UK’s dire record on investment. And, since the push to net zero involves a multi-year upgrade on the nation’s energy infrastructure, getting rid of tax cliff-edges is a sensible piece of long-term policymaking. Labour, notably, backs the move.
