The UK’s top manufacturing exporter has urged the Chancellor to make sure his Budget delivers for Business.
In their submission to the Treasury, the chemical industry has called for action on a series of measures to cut costs and incentivise investment in the UK. The Chemical Industries Association has said “The forthcoming Budget is an opportunity to further enhance the importance of an industrial basis to the UK’s economy”. Referring to Brexit, CIA added, “this Budget, against the Brexit background, comes at a critical time, with the need to signal to industry that the UK is not only open for business but remains a good place to invest in for the future”.
The industry is calling for the following:
- Abolish or at least “correct” the UK-only Carbon Price Support mechanism (with the current price of EU carbon this means chemical industry facing total pass through costs of £40/t CO2);
- Corporation tax (we urge Government to stick to the reduction timetable from the current 19% to the pledged 17% by 2020);
- Increase Capital Investment Allowances for plant and machinery and the purchasing of assets (the UK is the least competitive in G7);
- Not to introduce a UK plastics tax ( Reform of the Packaging Recovery Note system will deliver the sought after environmental progress);
- UK innovation support post Brexit including an ‘Innovation Bill’; and
- Preparation for cash flow issues linked to stocking and Brexit.
Speaking about the submission, the Chief Executive of the Chemical Industries Association, Steve Elliott said “by incentivising business through the measures we have proposed, society benefits. As companies invest and grow in the UK, there are more jobs created in their companies and in their UK supply chains. Our industry manufactures products and technologies that deliver environmental benefits too, such as auto-catalysts, energy efficient oils and wind turbine blades.
The measures we have called for will allow the country to kick start as we conclude Brexit. We continue to work with Government and all political parties to try and get the best deal for the UK. I want Philip Hammond to recognise the positive role business can play in the life of the country by setting the parameters for a new deal”.
The letter addressed to the Chancellor can be viewed here.
For further information, please contact Simon Marsh on 07951 389197 or [email protected]
- The chemical and pharmaceutical industry adds £18 billion of value to the UK economy every year from total annual turnover of £50 billion.
- In addition to gross value added, the sector also contributes to the UK economy in its position at the head of many supply chains within manufacturing and its employment of a well remunerated, high-skilled workforce. We support 500,000 jobs both directly and indirectly Chemical manufacturing adds £9 billion in gross value added annually and pharmaceutical manufacturing £9 billion.
- The wider chemical and pharmaceutical sector (manufacturing plus distribution) is the largest exporter of manufactured goods with annual exports of over £50 billion. The export of motor vehicle, trailers and semi-trailers is the sector with next highest exports of £35 billion. Aerospace is £32 billion.
- 63% of companies in the sector export what they make to the world, the highest proportion of any goods manufacturing sector in the UK economy. 60% of our exports go to the European Union and 75% of our imports and raw materials come from the European Union.
- The sector’s level of business investment is £4.3 billion, compared to automotive £2.7 billion and aerospace £2.1 billion, while the expenditure on research & development is £5.0 billion (automotive £2.7 billion and aerospace £2.1 billion).
- The products and technologies of the Chemical industry are essential parts of medicines, food & drink, telecommunications, energy-saving, I.T, clothing and much more.
- For every tonne of Greenhouse Gas (GHG) emitted, our products and technologies enable over 2 tonnes of GHG emissions savings.