Ed Miliband pledges tax break for small businesses

Labour leader promises cut in business rates for small firms as he delivers speech to party faithful

Labour leader Ed Miliband
Labour leader Ed Miliband

Ed Miliband will announce a tax break for Britain’s army of small businesses today, as he pledges to boost the economy, create jobs and help families cope with the cost of living.

The Labour leader will praise shops, pubs and other small firms as “the vibrant, dynamic businesses that will create wealth in Britain”, in his speech to his party’s conference in Brighton.

And he will announce plans to cut business rates for properties and commercial premises with an annual rental value of £50,000 or less.

It means 1.5 million businesses will each save £450 on average over two years, with some saving up to £2,000.

The money will come from reversing plans announced by the Government to cut taxes on big business.

George Osborne, the Chancellor, has set out plans to cut Corporation Tax paid by the 80,000 of the nation’s biggest companies from 21% to 20% in 2015 - but this only affects businesses with profits above £1.5m.

Mr Miliband will says his decision to scrap the Government’s plans and help small businesses instead illustrates the difference between a Labour Government and the current Tory-led administration.

His speech will focus on the failure to ensure that the ordinary people share in the nation’s wealth.

He will also set out plans to tackle the housing crisis by building a new generation of new towns.

The Labour leader will say: “For generations in Britain, when the economy grew, most people got better off.

“But somewhere along the way, that vital link between the wealth of the country as a whole and your family finances has been broken.”

Highlighting Labour plans to make the cost of living the theme of the next General Election, Mr Miliband will add: “At the General ELection in 2015, you should ask yourself: am I better off now than I was five years ago?”

Announcing plans to back small businesses, he will say: “Most of the jobs of the future are going to be created in a large number of small businesses - not a small number of large businesses.”

Mr Miliband will add: “One of the first acts of a new Labour government will be to use all the money that David Cameron wants to spend helping just 80,000 big businesses to cut business rates for 1.5 million shops, pubs, workshops and hi-tech firms in our country - and then freeze it the following year.”

Meanwhile, the future of the high speed line between London, Birmingham and the North was thrown into doubt after Shadow Chancellor Ed Balls revealed Labour would look again at whether it was the best way to expand capacity on the rail network.

Mr Balls told activists that Labour would consider whether the line known as High Speed Two or HS2 “is the best way to spend £50bn for the future of our country.”

A Labour source confirmed after the speech that this meant looking again at whether other options for expanding capacity, such as improving the East Coast Main Line and West Coast Main Line, offered better value for money.

A review of the project could also consider building a new line using a different route to the one currently planned.

Previously, Labour had said it would set a limit of £50bn on the cost of HS2 - but appeared committed to building the line as long as it stayed within this limit.

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