The business community generally welcomed the Chancellor’s comment that the Budget “unashamedly supports business”.
However John Rider, West Midlands chairman of the Institute of Directors, insisted: “We need action now; jam tomorrow is no good.
“And I fear the Government has not done enough to free business from the burdens and barriers that are holding economic growth back.”
But he said it was right that the Chancellor should clamp down on abuse of the tax system: “Whoever it is, rich or poor, should expect to take the consequences.”
Birmingham Chamber of Commerce Group (BCCG) said cutting the 50p income tax rate by 5p in 2013 will send out 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.”
Louise Bennett, chief executive of the Coventry and Warwickshire Chamber of Commerce, was less enthusiastic but admitted there was something to give business the push it needed.
“The rhetoric at the beginning of the Chancellor’s speech filled us with great hope that this would deliver a great deal for business – particularly in Coventry and Warwickshire.
"But that soon drifted away with very little to inspire. Yes, the cut in corporation tax is very much welcome and a lot of the sentiment surrounding international trade and access to finance are exactly what business want. The problem now is we must wait to see whether those words are actually matched by the detail that follows.
“If we’re honest, it was quite London-centric in many regards and that obviously wasn’t particularly welcomed in this room.”
Richard Butler, CBI Regional Director for West Midlands & Oxfordshire, felt there was much in the Budget that would benefit the region.
He said: “From a business perspective in the West Midlands we welcome cuts to corporation tax, the review of the carbon reduction commitment and the establishment of a centre of excellence for aerodynamics. This will benefit the many aerospace companies in the region.”
Terry Last, chief executive officer of Ettingshall-based Tarmac, felt the Budget was necessarily safe under the current circumstances. He said: “Overall, this is a ‘firm hand on the tiller’ budget and not one of fundamental change.
"Yes, there are eye-catching moves such as the intention to reduce Corporation Tax to 20p after the next parliament – however at present this is just a good signal of intent. More needs to be done to help businesses, particularly in the hard-hit construction sector, now.”
John Hodgson, tax managing partner of the Birmingham office at Smith & Williamson, felt there needs to be more from the Chancellor in the future.
“Neon lights of a cut in corporation tax and top rate of income tax give the impression that the country is open for business; however, we would like to see the Chancellor do more to help enterprise when he can,” he said.
“Hemmed in and obliged to remain fiscally neutral, the Chancellor did as much as he could but his hands were tied by the difficult economic backdrop.”
BDO’s Richard Rose felt the losers were those who tried to play the system. “The majority of these measures are favourable to most individual tax payers and businesses, but understandably will not be welcomed by the very small number of people who wish to indulge in overtly abusive tax avoidance,” he said.
Dave Munton, managing partner at Grant Thornton in Birmingham, said: “Today could mark a turning point for our economy. A small upgrade in economic growth to 0.8 per cent for 2012 is far from something to shout about, but is a definite step in the right direction and should boost local confidence.
“The Chancellor put a lot of emphasis on growth in the private sector, unveiling and strengthening myriad initiatives such as the Enterprise Finance Guarantee scheme and UK export finance. Such initiatives are good news for our region, many of whose manufacturers are looking overseas for growth and to a range of finance solutions to take their businesses forward.”
Mark Smith, regional chairman at PwC in the Midlands, added: “The Chancellor has clearly demonstrated that he wants to rebalance the economy by rewarding work and backing business.
“For the Midlands, it is encouraging that, in addition to giving the UK a highly competitive corporate tax rate, the Chancellor has highlighted the need to support modern hi-tech businesses – such as digital and life sciences companies – and encouraging investment in infrastructure. This support will be important to the region’s economy in the future.”
Andy Street, Chair of Greater Birmingham and Solihull Local Enterprise Partnership (GBSLEP), welcomed the business focus of the Budget.
“Details of further cuts in corporation tax to 24 per cent, a simplified tax system for smaller firms and promised reductions in planning bureaucracy will look to make Britain a more competitive place to do business and attract international investment.
“GBSLEP’s growth strategy is focused on business, people and place and there were – on the surface – positive announcements in each of these areas. In particular, we are pleased to hear that Birmingham will get £10m to become broadband super-connected and also welcome a £74m increase to the Growing Places Fund for West Midlands LEPs.
“We’ve already secured £15.2m through this initiative and the first recipients across our area will be announced shortly.”
Johnathan Dudley, Midlands managing partner at national audit, tax and advisory firm, Crowe Clark Whitehill, described the Budget as less Wallace & Gromit – the Chancellor’s analogy when extending film tax credits to the digital and animation sectors – and more Robin Hood.
“He has taken from the rich to give to the poor while squeezing the middle,” said Mr Dudley. “And, if it was supposed to be a Budget for business, it is hard to see that it has done a lot.”
David Smeeton, head of the Birmingham office of Colliers International, was more upbeat.
He said: “This was a carefully thought through budget that seems to have achieved a political balance within the coalition and likely to have a positive impact on rating agency and investor perceptions of UK political and economic stability.”
Simon Jonsson, Head of Tax at KPMG in Birmingham, supported this view. “Businesses in this region wanted three things from the announcement; improved competitiveness, de-cluttered legislation and growth stimulus, and the Chancellor has gone some way to achieving all three,” he said.
Nigel Reynolds, senior partner at accountancy firm Reynolds and Company, based at Birmingham International Park, felt that once again the Budget is of no use to small business – the backbone of this country.
He said: “I am very disappointed that the Chancellor has yet again reduced the headline rate of Corporation Tax.
“If this move is intended to encourage businesses to come to the UK, I consider it is ill thought out. After all, if they have not moved here to date, why continue to reduce the rate; obviously tax is not the issue.
“The Chancellor also started his speech on tax reform by quoting Adam Smith, who said that the rich should pay more in tax than the poor.
“Yet he then goes on to reduce the tax rate for large companies, while doing nothing for the small ones.”