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[ 22-04-2009 ]

Commenting on the Chancellor’s Budget statement, Liz Cameron, Chief Executive of Scottish Chambers of Commerce, said:

“Scottish businesses were looking to this Budget for a clear signal that the UK Government recognises the challenges they are facing and is prepared to take serious action to support the Scottish economy.  The reality is that there is much to praise in this budget, but also some worrying measures which could damage some of our fragile businesses.

“We welcome the doubling of the capital allowance for investment in 2009/10 to 40%.  This should boost and encourage many businesses as they prepare and plan for the future in a difficult economic climate.  Similarly we welcome the Chancellor’s announcement that he will provide new incentives for the development of smaller North Sea oil fields, helping to boost production and maximise the lifespan of our oil and gas reserves.

“The extension of businesses’ ability to offset current losses against past profits and measures to enhance the trade credit insurance scheme will also be welcomed, but we will need to look at the detail of how other measures will apply in Scotland, such as the £500 million boost to housebuilding and the £260 million of new money to invest in skills and training for young people.

“Less welcome is the news that Fuel Duty will increase by 2p in September and by 1p above inflation next April.  This will increase the cost of transport and doing business in Scotland, particularly in our rural areas  -  a cost which businesses can ill afford at this time.  Similarly the news that alcohol taxes are to rise by 2% will come as bad news to many businesses in the licensed trade, hospitality industry, tourism and food and drink sectors. 

“It is important to note the effect that the UK Budget will have on future Scottish Government spending plans.  Clearly there will be even greater pressure to produce efficiency savings, but we need to ensure that the consequential boost to the Scottish Budget of £104 million is invested wisely.  In the absence of any new measures by the UK Government to reduce general taxation on business, a cut in Business Rates for those Scottish businesses not benefitting from the Small Business Bonus Scheme would be most welcome.”