Tech sector reacts to Chancellor’s ‘mini-Budget’

Friday morning’s ‘mini-Budget’ felt more like a full fiscal plan for the UK as Kwasi Kwarteng delivered a sweeping set of measures.

The ‘pro-business’ Chancellor cancelled a planned rise in corporation tax from 20% to 25%; will simplify IR35 rules; keep the Annual Investment Allowance at ￡1 million permanently; widened the SEIS scheme; and spoke of UK 'investment zones'.

Moray Wright , CEO at Parkwalk Advisors , described the Budget as a “pivotal moment for high-growth technology businesses”.?

Russ Shaw CBE , founder of Tech London Advocates & Global Tech Advocates , said the unlocking of pension fund investments into UK assets and high-growth businesses – including new innovation funds and tech scaleups – was significant.

Seb Wallace , investment director at Triple Point , said “it is promising to see the long-discussed policy around pension reform come to fruition, unlocking investment into innovative high-growth companies in the UK”.

Sarah Barber , CEO of Jenson Ventures , described the measures as a “huge boon for fast-growth businesses”.

Stephen Page , founder and CEO of SFC Capital , said: “We have heard rhetoric about making the UK ‘a nation of entrepreneurs’ before – but the proposed measures... are all very encouraging."

Katie Gallagher OBE , managing director of Manchester Digital , said members of the trade body welcomed the reversal as well as the increase in National Insurance and reduction in income tax.?

Derek Ryan , UK MD at Bibby Financial Services , said the previous proposal to increase corporation tax to 25% would only have applied to those making profits of ￡50,000 or more, approximately 70% of businesses, adding: “For a significant number of the UK’s 5.6 million SMEs, profits fall well short of this threshold... consequently, today’s announcement makes little or no difference to their prospects for growth or survival."

Glenn Collins , head of ACCA welcomed the aim of simplifying tax.?“However the dissolution of the Office of Tax Simplification is worrying and will impact UK businesses," he added.

Gavin Poole , CEO at Hackney innovation and technology campus HERE EAST , said the creation of Special Investment Zones will attract talent, investment and spearhead growth for the regions around the UK that need it most.

Murray Campbell , business consultant at #RegTech AutoRek , said it was a clear priority for the government to increase competition in the financial services sector, demonstrating that the UK is an attractive market for both #FinTech and traditional financial firms.?

Mike Elton , director at logistics & supply chain tech firm FarEye , said the Chancellor had “dealt his trump cards all at once”, adding: “We needed a growth plan to help attract and retain staff right across the industry, and on the surface, we got it.?But will it be enough to keep the shelves stacked and books balanced? Retail businesses and their supply and logistics chains are really in dire straits.?The big question is whether these initiatives ultimately rob Peter to pay Paul."

Ritam Gandhi , founder of Studio Graphene said the streamlined Budget offering confirms that businesses will be receiving some much-needed support with their energy bills this winter. "This will protect businesses and consumers, and will prove a lifeline for many; however, the new price cap will do little to tend to the concerns of tech startups – many of whom are not office-based, but remain subject to the damaging influence of inflationary pressure on their costs."

Mohsin Rashid , co-founder of ZIPZERO Global Limited – a shopping app which allows people to earn cash back towards their monthly bills – said: “This new administration fundamentally misunderstands whom the cost-of-living crisis is hitting hardest. Allowing bankers to receive greater bonuses, with incalculable rises to incomes on top of six figures salaries, while providing only 63p a month more to the lowest earners seems invariably at odds with their strategy. A more tactful response would see tax support for the lowest earners – far more likely to re-enter the economy than to bolster individual savings.”