David petrie bbaa 3 0


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David petrie bbaa 3 0

  1. 1. The New Economic Landscape for Business Growth and Investing in the UK David Petrie Head of Corporate Finance, ICAEW 1 July 2011
  2. 2. Contents <ul><li>Introduction </li></ul><ul><li>UK Government Plan for Growth </li></ul><ul><ul><li>Tax system </li></ul></ul><ul><ul><li>UK competitiveness </li></ul></ul><ul><li>The Business Growth Fund </li></ul><ul><li>Questions </li></ul>
  3. 3. Introduction <ul><li>David Petrie, Head of Corporate Finance at ICAEW </li></ul><ul><li>Represents over 5,000 corporate financiers, many of whom are actively engaged in raising funds for start-ups and SMEs as well as advising Business Angels on exits </li></ul><ul><li>Experienced Corporate Financier with background at PwC </li></ul><ul><li>Business Angel - Formerly FD of a start-up in the alternative energy sector – in 2009 raised funds from Regional Development Agency and matched funding from Business Angels </li></ul><ul><li>Visiting lecturer at the University of Bath School of Management and AMBA Entrepreneurship Competition judge </li></ul><ul><li>Also over ten years experience in industry </li></ul>
  4. 4. UK Government Plan for Growth <ul><li>Government Objectives </li></ul><ul><li>Create the most competitive tax system in the G20 </li></ul><ul><li>Make the UK the best place in Europe to start, finance and grow a business </li></ul><ul><li>Encourage investment and exports as a route to a more balanced economy </li></ul><ul><li>Create a more educated workforce that is the most flexible in Europe </li></ul>Source: HM Treasury and BIS, The Plan for Growth, March 2011
  5. 5. Tax system <ul><li>Creation of the most competitive tax system in the G20 </li></ul><ul><li>ICAEW - actively campaigning </li></ul><ul><li>Simplification </li></ul><ul><ul><li>Abolish 43 historic tax reliefs </li></ul></ul><ul><ul><li>Consultation on NIC and Income Tax reform </li></ul></ul><ul><ul><li>Improvements to IR 35 </li></ul></ul><ul><ul><li>Admin. Improvements for Small Business </li></ul></ul><ul><ul><li>Increased transparency of personal tax system </li></ul></ul><ul><li>Competitiveness </li></ul><ul><ul><li>Reduce CT from 28% to 26% to 23% by 2014 </li></ul></ul><ul><ul><li>Controlled Foreign Company (CFC) rules </li></ul></ul><ul><ul><li>Reduced taxation from profits from patents to 10% </li></ul></ul><ul><ul><li>Opt-in provisions to UK CT for foreign branches of UK companies </li></ul></ul>
  6. 6. UK competitiveness <ul><li>To make the UK the best place in Europe to start, finance and grow a business </li></ul><ul><li>Deregulation </li></ul><ul><ul><li>Drop Time to Train proposals for SMEs and other measures costing £350m </li></ul></ul><ul><ul><li>Moratorium on new regulation for new and micro-businesses </li></ul></ul><ul><ul><li>Implement Young proposals on Health & Safety </li></ul></ul><ul><ul><li>A general review of regulation </li></ul></ul><ul><li>Planning reform </li></ul><ul><ul><li>Streamlining of process </li></ul></ul><ul><ul><li>Release of Government land </li></ul></ul><ul><ul><li>Removal of national targets on re-use of brown-field sites </li></ul></ul><ul><ul><li>Review of commercial to residential </li></ul></ul><ul><ul><li>Fast track process for Major Infrastructure planning system </li></ul></ul>
  7. 7. UK competitiveness (Cont.) <ul><li>Start-up finance and business growth </li></ul><ul><ul><li>Reform of EIS and VCT – EIS relief raised to 30% </li></ul></ul><ul><ul><li>Qualifying company limits to be increased </li></ul></ul><ul><ul><li>Entrepreneurs’ lifetime limit doubled to £10m at 10% </li></ul></ul><ul><ul><li>Proposals for further seed investment </li></ul></ul><ul><ul><li>Small business rate relief holiday extended by 1 year </li></ul></ul><ul><li>Innovation </li></ul><ul><ul><li>R&D tax credit rate increases – 200% 2011 to 225% in 2012 </li></ul></ul><ul><ul><li>Simplification of the R&D tax credit schemes </li></ul></ul>
  8. 8. Business Growth Fund <ul><li>Overview </li></ul><ul><ul><li>£2.5bn fund, led by Stephen Welton </li></ul></ul><ul><ul><li>Regional infrastructure </li></ul></ul><ul><ul><li>£2m – £10m equity </li></ul></ul><ul><ul><li>Target company turnover £10m to £100m </li></ul></ul><ul><ul><li>Minority stakes </li></ul></ul><ul><li>Economic value </li></ul><ul><ul><li>Opinions divided </li></ul></ul><ul><ul><li>Where is the Equity Gap? </li></ul></ul><ul><ul><li>Incremental investment in UK economy </li></ul></ul>
  9. 9. Questions