Following the Chancellor's mini-budget on Friday 30 September, details published by the Government identify its plans to develop Investment Zones around the country with the aim of promoting economic growth in these areas.
The scheme focuses on attracting investment into these zones with two key policy proposals: reducing tax rates and relaxing planning restrictions.
Businesses moving into the Investment Zones will benefit from 100% business rates relief on any new or expanded premises, with the benefit set to be enjoyed for 25 years. They will also receive a zero rate for National Insurance contributions on new employee earnings up to £50,270 per year. Investment in plant and machinery will also receive the 100% first year enhanced capital allowance relief, alongside Enhanced Structures and Buildings Allowance relief of 20% per year. With businesses also able to obtain stamp duty land tax relief on land bought for commercial or residential development, there are clear tax incentives for businesses to either move or expand their operations within these Investment Zones.
Planning restrictions are being lifted as the Government intends to increase the provision of housing stock within the Investment Zones. It intends to remove some EU requirements that stall development, reduce lengthy consultations with public bodies as well as relax the level of national and local policy requirements. These plans don't just focus on future applications, but also those developments which have already received planning permission, as the Government aims to work alongside developers and local authorities to ensure planning doesn't prevent the accelerated delivery of proposed development sites.
The Government will publish more details in due course for the selection criteria on how to become an Investment Zone, but 38 localities have already been earmarked for showing interest in the initiative, and with the Government announcing the offer is extended to freeports also, there is the expectation that more will come forward hoping to benefit from a scheme which intends to reduce red tape and costs, encouraging faster investment across the country.
You can read the Government's official announcement on the scheme here. For more information on this article, please contact our Government & Public Services team.
