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UK budget tackles tax and business

Wednesday, March 21, 2012 - 03:06

March 21 - Britain's Finance Minister George Osborne said the economy was improving in his Budget, where he cut personal income taxes but aimed new levies at the wealthy, taking a political gamble in times of austerity. But one small UK business says the government should do more to help them secure funding. Joanna Partridge reports.

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Harvesting energy from people's footsteps - to produce electricity. Small British firm Pavegen has created an innovative paving slab to do just this. CEO Laurence Kemball-Cook has been developing the technology since 2009. SOUNDBITE: Laurence Kemball-Cook, CEO of Pavegen, saying (English): "So in our cities, every time people walk, we can use that power to power things like lighting and anything on the street can be plugged straight into the technology." Pavegen now employs 22 people in the UK and abroad - and they've got big growth plans. Like many other businesses, they're looking closely at the details of Chancellor George Osborne's Budget. Osborne says he wants to boost Britain's growth. SOUNDBITE: British Chancellor, George Osborne, saying (English): "This Budget supports working families and helps those looking for work. It unashamedly backs business." Osborne says the government is simplifying tax and improving employment and planning laws. The top tax rate will be reduced to 45p in the pound, and they'll also cut corporation tax gradually over the next few years from 25% now to 22% in 2014. SOUNDBITE: British Chancellor, George Osborne, saying (English): "The biggest sustained reduction in business tax rates for a generation, a headline rate that is not just lower than our competitors but dramatically lower, 18% lower than the U.S., 16% lower than Japan, 12% below France and 8% below Germany, an advertisement for investment and jobs in Britain." The level at which people start paying income tax has also been raised by over £1,000 to £9,205. And while for now there's no change to tax on alcohol or fuel, a packet of cigarettes will cost an extra 37 pence, and a new tax will be introduced for machine games. PTC At a time when the government is talking about rebalancing the British economy back towards manufacturing, small businesses like Pavegen, which make products in the UK, say they still need government help in the initial stages of growth. Pavegen has already received some government funding, but Laurence says start-ups need more financial help early on. SOUNDBITE: Laurence Kemball-Cook, CEO of Pavegen, saying (English): "It's really difficult to get bank funding at a level that is going to help you grow. So I think there need to be more ways to secure funding for young businesses to explode and grow. Secondly, I think that London is a real hothouse for innovation, creativity and design, we've got brilliant people here with ideas that ultimately is going to be a solution to UK growth." While the Chancellor's mood was upbeat - Britain and the rest of Europe are still in tough economic times. The opposition Labour party criticised the Budget as "another bankers' bonus" and said it won't help get the unemployed back to work. Pavegen's verdict was more positive but in cutting personal income taxes, Osborne has taken a political gamble at a time when he has to stick to his government's tough austerity plan. Joanna Partridge, Reuters

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UK budget tackles tax and business

Wednesday, March 21, 2012 - 03:06