Tax cut aims to make 
UK system best in G20

George Osborne said the main rate of corporation tax will be cut by one per cent in April 2014 to 21 per cent, on top of previously announced reductions.

The Small Business Rate relief scheme will be extended by a further year to April 2014, while other measures include consulting on reducing “unnecessary burdens” created by regulations that cover the transfer of workers to other employers.

The Government has also announced that £120m will be made available to help manufacturers invest in areas including equipment, research and skills.

The money will fund a scheme in England aimed at firms in the sector’s supply chain, including aerospace, automotive, chemicals, construction, life sciences and energy.

A business bank will become fully operational in the autumn of 2014.

However, no new money was announced yesterday for the £1bn venture.

Kenton Robbins, the Yorkshire and Humber regional chairman of the Institute of Directors, said last night: “The reduction in corporation tax will be seen as a resounding message of support for business.

“While not a vast amount, it is a step in the right direction.”

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