After business leaders call for lower taxes, boss of FTSE100 giant Sage tells Chancellor Rishi Sunak: Give firms a tech tax break
The boss of FTSE100 software giant Sage has called on Chancellor Rishi Sunak to deliver sweeping tax breaks for tech investment.
Steve Hare said this could foster an unprecedented £232billion ‘turbo charge’ for the economy.
He said Ministers must ‘pull every lever’ to accelerate the shift and he called for new policies to encourage investment.
Plea: Steve Hare has called on Chancellor Rishi Sunak to deliver sweeping tax breaks for tech investment
Newcastle-based Sage is one of Britain’s most successful technology firms and employs 11,000 staff. In a piece for The Mail on Sunday this weekend, published online, Hare said he does not underestimate the challenges facing the economy. But he said he believes businesses are ‘resilient’ and he remains optimistic.
Last week, business leaders called for the Government to scrap a planned hike in the corporation tax rate and instead slash it dramatically to give the economy a boost They said the tax – currently 19 per cent but set to rocket to 25 per cent next year – should be cut to as little as 12.5 per cent.
Hare wants tax breaks on investment in traditional plant and machinery to be extended to cover technology and digital industries.
He said he believes a digital boom could lift businesses in a shift that will be as important as ‘the original internet revolution’.
A report on 5,000 small and medium-sized firms handed to Parliament by Sage reveals that more than half are using technology to cut costs and better compete for customers. The study found that many would go much further, but are concerned about the cost and access to the right skills to use and implement it.
The use of technology by small and medium firms contributes an estimated £216billion to the economy. But that could more than double with new policies to encourage tech adoption, the report said.
That includes providing 5G and high-speed broadband across the country, demanding ‘digital literacy’ in schools and remodelling the tax system ‘so that every pound spent on tech equipment is treated as a capital investment rather than an operating expense’.
Hare continued: ‘Looking beyond the immediate economic and political cycles, there are reasons to be quietly and cautiously optimistic about the future.
‘At Sage we work with small and medium-sized businesses every day. They are a resilient and thriving part of our country’s fabric, responsible for 62 per cent of all economic activity. The greatest risk is that some are unable to share in the coming digital boom.
‘All political leaders that wish to be taken seriously should turbocharge their policy ambitions to support this digital future.’
Milton Keynes MP Ben Everitt said: ‘SMEs and the next unicorns will be born digital. We need to grab that talent and opportunity and support them, and government has a big role to play.’