The highlights at a glance

At the centre of Budget 2010 is the £2.5bn package for small and medium – sized businesses. The Chancellor used this Budget to announce a number of new measures intending to improve the cash flow situation of SMEs, but many won’t actually come into force until next year.

 

The Chancellor’s speech addressed the issues facing SMEs recognising the value they contribute to the UK economy. The main bank lenders into the SME sector (RBS and Lloyds) have been mandated to lend £94 billion to struggling small businesses. Other government support was offered in the form of a new venture capital fund with £200 million committed to providing additional capital to SMEs and he also introduced some specific tax measures to help with cash flow with the extension of the ‘Time to pay’ scheme, throughout the life of the next parliament.

Business highlights

RBS and Lloyds must provide £94 billion in new business loans, half of which must be provided to small to medium-sized businesses.

A credit adjudicator service to be set up to help SMEs to deal with complaints and examine lending decisions to determine whether they are fair.

The government will set UK Finance for Growth to help to expand the financial sector. The FSA to speed up the licensing process for new banks.

Commitment to G20-approved levy on banks.

Business rates will be cut for one year from October.

The computer games sector in Britain will receive investment. Will also set up a £35 million University Enterprise Capital Fund.

To introduce a 50p tax on landlines to fund superfast broadband rollout for 90 per cent of the country by 2017.

To double the annual investment allowance to £100,000. The main rate of capital gains tax will not increase.

Entrepreneurs’ relief for capital gains tax to be increased to £2 million.

15 per cent more of government contracts will go to small to medium-sized businesses, many of which count the central government as one of their key clients.

The ‘Time to Pay’ scheme for tax payments from SMEs will be extended for the whole of the next parliament.

Pledges that the government will pay 80 per cent of invoices from small business within five days.