Business: Government Assistance

Treasury written question – answered on 8th February 2021.

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Photo of Dan Jarvis Dan Jarvis Labour, Barnsley Central

To ask the Chancellor of the Exchequer, what recent assessment he has made of the potential merits of providing support to businesses in their first year of trading.

Photo of Kemi Badenoch Kemi Badenoch The Exchequer Secretary, Minister for Equalities

The Government regularly engages with businesses and representative groups to ensure support provided to businesses is appropriate, including support for those businesses recently established and in their first year of trading.

For example, the British Business Bank’s Start-Up Loans programme provides entrepreneurs starting their own businesses with loans of up to £25,000 and 12 months of dedicated mentoring support. At the Spending Review 2020, the Chancellor announced additional funding for this programme to deliver 1,000 more loans in 2021/22 than were originally funded in the March 2020 Budget.

The Government also offers generous tax incentives to investors in early stage companies looking to grow, in the shape of the Enterprise Investment Scheme (EIS) and Seed EIS (SEIS). These are intended to help tackle market failures in young companies’ access to finance by helping them raise the capital needed for their long-term growth until they have a sufficient track record to access mainstream markets.

Additionally, further reducing the tax burden on businesses, the Government has lowered the corporation tax rate from 28% in 2010 to 19% today - this is the lowest rate in the G20 and benefits over one million companies, large and small.

In addition to these measures and to support businesses through Covid, the Government has spent over £280 billion to put in place a comprehensive package of support. Businesses may be eligible to benefit from elements of this package including billions of pounds in wage support, government-backed loans and general and sector-specific grants. The Government urges businesses to visit the online Coronavirus Business Support Finder Tool for tailored information on how to access support available to them.

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