Boris Johnson vows to overhaul business tax regime to boost growth after Covid

Harry Yorke
·2-min read
Boris Johnson
Boris Johnson

Boris Johnson has pledged an overhaul of red tape and business taxes to turbocharge Britain's recovery next year as the coronavirus outbreak comes to an end.

In a move that could set him on a collision course with fiscal hawks in the Treasury, the Prime Minister said the Government would be looking at the “tax and regulatory environment” as he vowed to make Britain “the best place in the world” to invest and start a business.

Speaking during an online question and answer session dubbed People’s PMQs, Mr Johnson pointed out that the Treasury had already cut VAT and introduced business rate holidays during the pandemic.

Asked how he intended to help entrepreneurs and small businesses “build back better”, the Prime Minister said: “I can tell you that the Chancellor, Rishi Sunak, is looking at all the fiscal, the regulatory environment that we need to have to make sure that this is the best place in the world to start a business, the best place to invest. 

“And we do everything to make life easy for businesses, for small and medium enterprises, and for big business as well. Because in the end, that's the motor that's going to enable us to pay for all the things that we're going to need in the future.

"So we'll be looking at the tax environment, the regulatory environment, and everything to encourage and support businesses across the country.”

Timeline | Financial support measures to fight coronavirus
Timeline | Financial support measures to fight coronavirus

His comments stand in stark contrast to remarks by Mr Sunak, who yesterday issued a fresh warning over Britain’s mounting debt pile which he said has left the country “much more sensitive” to any rise in interest rates.

The national debt now stands at a record £2.08 trillion and is above 100pc of GDP for the first time since the 1960s.

While Downing Street has pushed back against suggestions of major tax hikes to pay for the costs of the pandemic, the Chancellor has warned that “tough choices” lie ahead and recently joked that he wanted to take away the Prime Minister’s credit card.

He is currently studying proposals to hike capital gains in line with income tax, as well as slashing pensions tax relief for higher earners, although he is understood to be sympathetic to calls for cuts to business rates.