The Chemical Industries Association welcomes the Chancellor's Pre-Budget Report announcement that he will introduce a ‘Patent Box' regime for the UK to boost innovation and investment in biotech and pharmaceuticals.

Innovation
The Patent Box means that income from technology patented in the UK will be taxed at a reduced rate, this will encourage companies with research and development in the UK to also locate their manufacturing here. 

Commenting on the budget Steve Elliott, CIA Chief Executive said "combined with the significant investment for advanced manufacturing in Teeside and Wilton, the announcement of the Patent Box regime is a very positive step towards the Government's commitment a rebalance, low carbon, economy."

Help for biotech and pharmaceutical companies is good news for the chemical suppliers to these sectors.

Investment
The CIA welcomes the Government commitment to a £20m investment in the Wilton International site (the location of a significant chemicals cluster) to strengthen and sustain competitiveness and employment in chemical businesses. A further £30m has also been agreed to support Teeside projects that will help deliver the UK's low-carbon advanced manufacturing future. 

Credit
Credit availability is still difficult so we welcome the confirmation that a £500 million capital growth fund will be announced shortly and the extension of the small firms loan guarantee. 

Climate Change Levy
Given the extremely challenging year and the long road back to our early 2008 performance it was disappointing so see the reduction of Climate Change Levy relief from 80% to 65%. We had hoped that any reduction in CCL relief would be minimised, and that the relief might be varied across fuel types in order to minimise the bottom line impact of this change.

Commenting on the CCL Change Steve Elliott added "slashing the CCL relief has removed a key incentive to industry to invest in cutting carbon emissions. This is a cost that only hits UK companies who are already faced with greater energy costs than many of their competitors."

National Insurance
Although the National Insurance increase was already on the way it is disappointing that this tax on jobs is another impediment to companies looking to make the most of the improving economic outlook.

Contact Name: Fiona Ferguson