The Association of British Insurers (ABI) has welcomed many of the changes revealed in today's budget, despite the fact they will have little direct impact on the insurance industry.
Chancellor George Osborne announced that corporation tax, which had been due to fall to 25p this year, would instead be reduced to 24p.
Otto Thoresen, director general of the ABI, said the trade body “strongly welcomed” this move.
He said: “It will undoubtedly improve the competitiveness of the UK, and increase returns for investors in British companies.”
Measures to provide multinationals with assurances that profits earned overseas would not be taxed at the UK rate would also benefit the insurance industry accordign to the ABI: “The reforms have the potential to attract insurers to Britain rather than drive them away as the current rules do.
“However, the rules work rather differently for insurers than for other industries and much of the legislation important for insurers will only be published for the first time in the Finance Bill. Other crucial parts are still uncertain.
“Until we have seen the Finance Bill we will not know if the reforms will be a success, but we welcome the Government’s focus on this important area of business taxation.”
Mr Thoresen also responded to Mr Osborne’s proposed reforms to the planning process, and said that while he was in favour of building sustainable new communities, it should not be done at the expense of allowing “unwise” developments in flood risk areas to start again.
Mr Thoresen added: “Having succeeded in recent years in largely stopping developments in high flood risk areas it is vital that these controls are not relaxed as part of any reform to the planning rules.”
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