Britain’s Hunt makes business investment tax break permanent to drive growth

Britain’s finance minister Jeremy Hunt made a tax break for business investment permanent on Wednesday, aiming to kickstart the country’s economy with more investment.

Britain has suffered from weak business investment since the Brexit vote in 2016 and Hunt hopes that by making permanent the tax break known as “full expensing” companies will spend more on new kit and technology, lifting productivity.

“I will today make full expensing permanent. This is the largest business tax cut in modern British history,” Hunt said in his Autumn Statement on Wednesday.

He added that the boost to investment represented “a decisive step towards closing the productivity gap with other major economies and the most effective way we can raise wages and living standards for every family in the country.”

Full expensing is a capital allowance scheme which allows companies to deduct 100% of the cost of qualifying plant and machinery from their taxable profits.

Hunt said that the scheme costs 11 billion pounds ($13.7 billion) a year. It was brought in earlier this year and had been due to expire in 2026.

via Reuters