Latest tax and investment news
Patent tax relief 'will be ineffective'
Proposals by the government to introduce £1.3 billion of patent tax relief have been criticised by a leading think tank, which said that only a few large companies would be able to benefit from it.
The Institute of Fiscal Studies (IFS) said the plans to reduce the tax on income on patents from 28 per cent to ten per cent, announced by the Treasury in December, would only subsidise activities that were going to go ahead anyway, the Financial Times reports.
"A reduced rate of corporation tax on patent income seems unlikely to encourage much additional innovative activity in the UK either from domestic firms or from encouraging multinationals to locate innovative activities here," the IFS told the paper.
The plans are intended to stop the increasing trend for companies to move patents out of the UK and into low tax jurisdictions.
It follows news that more than £700 million of affordable funding from the European Investment Bank has been approved for small businesses in the UK.
Posted by Susie Cho.
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