Hunt faces calls to 'look to the future' and drop 'factory tax'

Britain Remade, a campaign group calling for greater investment in infrastructure and green energy, has called for an end to barriers which it claims are blocking growth, jobs and prosperity, especially in Britain’s industrial heartlands in the North.

It argued that businesses are facing a “cliff-edge” in April with the rise in Corporation Tax and end of the super-deduction on investments.

The group said that “full expensing”, one of the options being reviewed by the Chancellor ahead of next week’s budget would be key to unlocking growth in the country.

This will be one of Britain Remade’s policy recommendations in its “powerbook” paper due to be released later this month as part of a roadmap to how the country can be energy secure by 2030.

One renewable energy developer, Orsted, which is developing the £8 billion Hornsea Three wind farm off the East coast, warned that without changes to the tax system they may have to cancel this massive investment.

Hornsea 3 will be the largest offshore wind farm in the world, capable of generating enough energy to power 3.2m homes.

It will be the first customer for the £400 million factory currently being built at the Teesside Freeport by SeAH Wind, which is set to create 1,500 jobs in the supply chain and during construction, in addition to a further 750 direct operational roles.

Sam Richards, founder of Britain Remade, said: “When Jeremy Hunt stands at the Despatch Box next week to deliver his first Budget, he has a choice.

“He can either take a ‘steady as she goes’ approach and only focus on the bottom line; or he can look to the future, and alongside vital planning reforms, permanently drop the factory tax to boost investment, drive growth and create tens of thousands of jobs, may in Britain’s former industrial heartlands of the North and Midlands.

“Anything other than a permanent change would simply be a furlough scheme for Britain’s anaemic growth over the past 13 years when what we need is a vaccine.

“Britain may not have the same economic firepower as the US, China or the EU, but what we can do is make the country as open to investment as possible through a business friendly tax system and a common sense planning system. Without action major clean energy projects, like Hornsea Three risk being shelved putting growth and jobs at substantial risk.

“When Jeremy Hunt was appointed Chancellor his number one task was to stabilise the economy and restore confidence. On both fronts he has been successful, now he needs to take bold action to boost growth.”

This comes as the country’s green energy sector faces stiff competition from abroad, with the US’ Inflation Reduction Act causing companies to reassess their investments and take advantage of America’s generous renewable energy subsidies.

Similarly the EU is set to respond to Joe Biden’s move by looking at its own rules over investments in order to compete.

It comes after Ed Milliband, Labour’s shadow climate change secretary, called on the Government to combat this increased competition from other advanced economies.

“One of the very striking things you are seeing in America is Joe Biden pushing forward with his Inflation Reduction Act, this reindustrialisation of America,” he told The Yorkshire Post last month.

“We need a government that needs to do a British version of the Inflation Reduction Act to generate these jobs, and jobs in Yorkshire.

“As I’ve seen in my visit today there’s huge potential here for the country.”