What's Happening?
The UK's manufacturing sector is expressing concern over potential deindustrialisation due to proposed business tax increases and high industrial energy costs. Make UK, a leading manufacturing organization, has highlighted the significant rise in business costs this
year, exacerbated by increased National Insurance Contributions and potential changes to Inheritance Tax. The organization is urging the government to focus on growth measures in the upcoming Budget, warning that further tax increases could severely impact the sector. Make UK is advocating for several measures, including expanding the British Industrial Competitiveness Scheme, ringfencing funds for skills investment, and providing targeted tax exemptions for green technology investments.
Why It's Important?
The manufacturing sector is a critical component of the UK's economy, and its health is vital for economic stability and growth. The potential deindustrialisation poses a threat to jobs, innovation, and the UK's competitive position globally. High energy costs and increased taxes could lead to reduced investment and production, impacting the broader economy. The government's response in the upcoming Budget will be crucial in determining the sector's future trajectory. A focus on reducing energy costs and supporting industrial growth could help mitigate these risks and support economic recovery.
What's Next?
The government's Budget announcement will be closely watched by industry stakeholders. The measures proposed by Make UK, if adopted, could provide relief and support to the manufacturing sector. However, failure to address these concerns could lead to further economic challenges. The sector will be looking for clear commitments from the government to support growth and competitiveness.
