AS THE Chancellor prepares the finishing touches for his budget speech this week, a Thames Valley-based financial adviser has warned that businesses want to see a focus on training.
This would help firms invest in skills that would support business growth.
Grant Thornton UK LLP says its latest Business Outlook Tracker – a survey of 600 mid-sized businesses – shows that mid-market sized companies also want to see infrastructure improvements, and incentives for employers to invest in research and development.
These include tax incentives, and a simplification of the business tax system.
Grant Thornton’s research also suggested that ‘attracting and retaining people’ is currently the biggest challenge to mid-sized businesses over the next six months.
Research finds that almost three quarters of respondents are facing a shortage in operational (72%), financial (69%) and managerial (69%) roles.
Other challenges include ‘meeting changing customer expectations’ and ‘prioritising sustainability’.
Government support would include grants to help fund investments in innovation, training for leadership and management, and access to advice and support with an emphasis on growth.
Norman Armstrong, Practice Leader for Grant Thornton UK LLP in the Thames Valley and Southampton, said: “Skills has come out as a top priority for businesses across our latest survey, as the market continues to compete for talent.
“But as businesses can, generally, already deduct 100% of staff training and development costs against their taxable profit, and we’re not expecting the government to go further and introduce a super deduction, it’s unlikely that we will see significant changes in this area.
“This Spring Budget is also expected to be a quieter affair with regards to R&D, after last year’s Autumn Statement confirmed the government’s wide-reaching review – which has been ongoing since 2021 – has now concluded.
“While tax incentives for green investment would help to reduce costs for businesses investing in energy efficient and low or zero carbon technology, as part of their environmental strategies, the chances of green tax incentives is looking slim.”
He continued: “The Chancellor kicked off 2024 signalling his desire to cut taxes further, observing at Davos the benefits that low-tax economics bring to growth and the creation of dynamic economies. Whether he can deliver on this ambition will hinge on the final OBR economic and fiscal forecast.
“As this is anticipated to be the last major fiscal event ahead of the General Election, any announcements are expected to be focused on closing the gap in the polls, with business tax cuts coming in second, behind those to reduce the tax burden for individuals.
“Our research shows that businesses in the Thames Valley are clear on what support they want to see from government, so we hope to see their needs addressed in some form in next week’s announcement.”
