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Brexit impact: Osborne to cut corporation tax and boost Northern Powerhouse

George Osborne chancellor hard hat Willmott Dixon site
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George Osborne has pledged to slash corporation tax to create a ‘super-competitive economy’ and boost the Northern Powerhouse as part of his post-Brexit plans

In an interview with the Financial Times, the Chancellor of the Exchequer said that Britain was ‘still open for business’ as he outlined a five-point plan to counter any economic jitters following the UK’s decision to leave the EU. 

He added that he would reduce the rate of corporation tax to below 15 per cent – around five per cent lower than the current 20 per cent rate.

If fulfilled, Osborne’s pledge would mean the UK has the lowest corporation tax of any major economy. The move comes just days after Osborne scrapped his target of to create a budget surplus by 2020.

Osborne told the Financial Times: ‘We must focus on the horizon and the journey ahead and make the most of the hand we’ve been dealt.’

The chancellor also said that he wants to bolster the Northern Powerhouse.

The comments echoed those he made last week to a group of business leaders: ’If anything, the referendum result is even more of an instruction to deliver that powerhouse and make it a reality.’

Meanwhile the Federation of Small Businesses (FSB) has revealed that confidence among small businesses plunged to a four year low in the run-up to the referendum.

The new research of 1,000 FSB members, conducted in April and May, saw a fall in confidence for every region in the UK. The largest drop in confidence was in London, which fell into negative territory for the first time since 2012. 

The survey also found that only one in eight of the members asked planned investment in the next year - a decrease of almost a third from 12 months ago.

 

 

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