Harrogate business leader praises new Chancellor’s mini budget for boosting economy

Before the mini budget measures were unveiled by Chancellor Kwasi Kwarteng, Harrogate business leaders had said they welcomed news that electricity costs for UK businesses, charities and public sector bodies were to be capped for the next six months but that they needed to see medium to longer term help - including business rates to be scrapped for the rest of the year and a reduction in the rate of VAT from 20% to 12.5%.

Although neither of those two things happened, Harrogate Business Improvement District (BID) welcomed the Chancellor's series of tax cuts and economic measures that he claims will boost economic growth.

David Simister, Chief Executive of Harrogate District Chamber of commerce, said: “The UK’s economic situation is very fragile, we are technically in recession.

“The aim of this emergency budget is to stimulate the economy by cutting taxes and giving people more money in their pockets.

“The scrapping of the National Insurance rise and reversing the increase in Corporation Tax is certainly good news for businesses large and small.

“Employees across the board will benefit from the NI reduction, as well as the cut in the basic rate of income tax, but the latter won’t be felt until after next April.

"Cutting the cap on bankers’ bonuses is a contentious issue for some, but it is designed to attract the brightest and the best in the industry to the UK.

“Axing the rise in beer duty will certainly be welcomed by the region’s breweries and hospitality trade, particularly as we are getting ever closer to the Festive period.

“Whilst raising the stamp duty threshold is designed to help first time buyers, it’s been said it might actually have a reverse affect and push house prices up.

“With announcements earlier in the week it’s clear the new administration is listening to the concerns of businesses, but we still need a review of Business Rates.”

The mini budget included the following:

The basic rate of income tax has been cut to 19p and the 45% top rate of tax for higher earners abolished.

The threshold before stamp duty is paid has been raised to £250,000 - for first time buyers it's £425,000.

The cap on bankers' bonuses has been lifted, and a planned rise in corporation tax has been scrapped.

An increase in National Insurance has been reversed, and low-tax investment zones will be set up across the UK.

Opposition politicians claimed that most of the new measures would do little for struggling families in the cost of living crisis.

Labour's shadow chancellor Rachel Reeves said it was a plan "to reward the already wealthy".

The Confederation of Business Industry, said the chancellor's fiscal statement was a “turning point for our economy".

The Director General of the British Chambers of Commerce (BCC), Shevaun Havilland, said: “Businesses will welcome many of the measures announced that should boost economic growth, relieve cost pressures and encourage investment.”

But The Children’s Society chief executive Mark Russell said the government was “failing miserably” to meet the needs of struggling low-income families.

Following Chancellor Kwarteng's announcements, financial markets reacted badly with the pound failing 1% against the dollar to $1.11.