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Budget brings good news for small-to-medium sized printing companies

With the printing industry still feeling the effects of the 2008 banking crisis, the approach of the Chancellor of the Exchequer's annual budget is always a tricky time for small-to-medium sized printing enterprises. Keeping the balance sheet in the black is difficult enough without HM's Government taking a big bite out of profits via tax.

The news for such printers from George Osbourne's 2016 budget was better than expected though. In the 2015 'Emergency Budget', released in July last year, Osbourne had already announced that corporation tax would be cut from twenty percent to nineteen percent in 2017, with a further reduction to eighteen percent scheduled for 2020.

However, in the Chancellor's statement on March 16 he announced that corporation tax will now fall to seventeen percent by April 2020.

Osbourne also announced that business taxes would reduce. Around nine out of every ten small businesses will have more cash in their accounts thanks to lower stamp duty being charged on commercial properties.

The best news for printers and graphic design companies was that those companies with an annual rateable value that's less than £12,000 will now be exempt from having to pay business rates. Companies that have rateable values of less than £51,000 will also now qualify for tapered relief – previously, this upper limit was set at £18,000. These changes will become effective from April 1, 2017, and it's thought that 600,000 businesses will see benefits as a result.

For employees in the print and graphic design industries there were changes too in personal tax allowances and bands. The higher rate of income tax is now payable on annual salaries of £45,000 and over, which had a previous upper limit of £42,286. The basic personal allowance will rise to £11,500 in April 2017. This is currently £10,600, with an increase to £11,000 already forthcoming in April 2016.

Commentators from print and graphic design agencies welcomed the news of Osbourne's spending and saving plans. It is thought the changes will benefit the overwhelming majority of people working in the print and graphic design industry, as most people so employed earn less than the higher rate tax threshold.

One of the surprises of the budget was the creation of the so-called 'sugar tax' which will see soft drinks manufacturers charge more for their products. How this has an impact on consumers and drinks companies, the knock-on effect to the print and graphic design industry will have to be seen.