Businesses across the Midlands are gearing up for the introduction of two proposed Investment Zones, after the Government unveiled the first in South Yorkshire.
According to BDO LLP’s bi-monthly Economic Engine survey of 500 mid-market businesses, 72% of regional companies have, or will consider moving part of their business to one of two proposed Investment Zones. These have been earmarked for the East Midlands Mayoral Combined County Authority and West Midlands Mayoral Combined Authority.
The survey by the accountancy and business advisory firm comes after the Chancellor officially named the first UK Advanced Manufacturing Investment Zone. As part of the Government’s ‘Levelling Up’ agenda to create opportunities across the country, communities in Sheffield, Rotherham, Doncaster and Barnsley will benefit from an estimated 8,000 new jobs and £1.2 billion of private funding by 2030. They will also receive further Government funding through the Investment Zone worth up to £80 million.
Twelve Investment Zones will be established across the UK based around a university and clusters of high growth industries like advanced manufacturing, life sciences or green industries. At the Spring Budget, Jeremy Hunt announced the first eight eligible locations, including in East and West Midlands.
Kyla Bellingall, regional managing partner at BDO in the Midlands, said: “Much was made in the Spring Budget about the proposed Investment Zones and the job creation and funding that would come from their introduction in a bid to drive growth.
“It’s clear that the package of funding to support infrastructure and skills, with the added draw of a range of tax reliefs, is giving regional businesses real food for thought about where they base all, or part of their operations, moving forward.
“The unveiling of South Yorkshire as the first Investment Zone marks a significant step forward in the Government’s Levelling Up agenda. However, much more still needs to be done to provide regional businesses with the strong foundations they need to thrive and grow.”
According to BDO’s Economic Engine survey, Midlands businesses believe the Government should do more to reduce taxes, particularly business taxes. Nearly a quarter of regional businesses (22%) said the priority should be around providing more generous tax reliefs for R&D, with nearly one in five (17%) calling for further support to reduce business rates.
Claire Hudson, tax partner in the Midlands, added: “Reducing business taxes, including the headline rate of corporation tax, is right up there on the list of priorities for companies.
“With the cost of doing business at an all-time high, thanks to record inflation and soaring interest rates amongst other pressures, business leaders are looking for some much needed respite.
“Midlands businesses have consistently told us through our Economic Engine survey that the Government needs to do more to support the regional economy and deliver on its ‘Levelling Up’ promise – and tax is currently taking centre stage.”
