“I’m launching two wide-ranging consultations: to make sure our research and development tax reliefs – and our Enterprise Management Incentives – are internationally competitive,” UK Chancellor of the Exchequer Rishi Sunak said in his Budget Speech to the House of Commons.
“A new unsponsored points-based visa to attract the best and most promising international talent in science, research and tech. New, improved visa processes for scale-ups and entrepreneurs; and radically simplified bureaucracy for high skilled visa applications,” he announced.
It was among several messages unveiled by the Global Indian minister this week that reflect his stated mission to make the UK the “best place in the world for high growth, innovative companies” and create a science superpower.
Sunak, who completed one year in office as the Chancellor just last month, was presenting his first Budget since the Covid-19 pandemic disrupted the global economy last year. And, the result was a vision statement widely welcomed by Indian business and industry groups, as holding out great promise for UK-India relations.
Baroness Usha Prashar, Chairperson of the Federation of Indian Chambers of Commerce and Industry (FICCI) UK Council, said the proposed visa would help attract talent from around the world and also highlighted how the creation of the first-ever UK Infrastructure Bank and eight new freeports have the potential to support trade between India and the UK.
Baroness Prashar said: “FICCI UK Council welcomes the Budget from the Chancellor Rishi Sunak; in the short-term, it will protect the economy and kickstart recovery. The Budget will help businesses to grow, and improving access to skills, capital, and ideas.
“The significant announcement of a £700 million support for the UK’s arts, culture, and sporting institutions as they reopen will ensure support to the sector. The launching of a consultation of a ‘new, unsponsored, points-based visa’ to attract international talent in science, research and tech' is a welcome announcement.”
While the announcement of at least £15 billion in green bonds and the world’s first sovereign green savings bond for retail investors are among some of the other welcome initiatives in the Budget, the House of Lords peer did strike a note of caution over a proposed Corporation Tax hike in a few years’ time.
“While the UK still remains the lowest in the G7 countries in terms of Corporation Tax, the hike of Corporation Tax to 25 per cent (from 19 per cent) in 2023 will impact large businesses, including Indian businesses in the UK,” she said.
The Confederation of Indian Industry (CII) flagged another welcome highlight from the Budget – the so-called super-deduction – which refers to a cut in companies’ tax bill by 25p for every pound they invest in new equipment, meaning they can reduce their taxable profits by 130 per cent of the cost, from April 2021.
Lakshmi Kaul, CII Head and Representative for the UK, said: “It is welcome that the government will continue to support businesses throughout the pandemic, through the furlough scheme and other programmes. This support should enable the UK economy to bounce back when the threat of the virus recedes. Given the extent of the government's support over the last 12 months, it is understandable that the widening spending gap will need to be plugged in future.
“While steep hikes in Corporation Tax face businesses from 2023, it is welcome that the government has sought to boost investment through a new super-deduction; this scheme should cover the digital economy as well as plant and machinery.”