What's Happening?
A manufacturing sector lobby group, Make UK, is urging the UK government to exempt manufacturers investing in green technologies from business rates for three years. The group argues that the current system, which increases business rates as factory values rise due to green investments, is counterproductive. Make UK is also calling for extended tax reliefs for capital stock related to industrial automation and decarbonization. The Treasury has not commented on potential changes to tax policy, stating that such decisions are made during fiscal events.
Why It's Important?
The call for business rates exemption highlights the tension between environmental goals and economic policies. By penalizing manufacturers for investing in green technologies, the current system may discourage companies from pursuing sustainable practices. Exempting these investments from business rates could incentivize more manufacturers to adopt eco-friendly technologies, aligning with broader environmental objectives. This move could also enhance the competitiveness of the manufacturing sector by reducing operational costs and promoting innovation in green technology.
