The forthcoming Budget may include news about improved tax reliefs for small firms.
Entrepreneur, Sir James Dyson, who was giving a speech at the topping off ceremony for a new design engineering facility at the Royal College of Art, to which his charitable foundation contributed a £5 million donation, said that he believed the Treasury is considering a boost to the R&D tax credit system.
One possibility is the tax credit will be increased to 200 per cent for small technology businesses.
Sir James said: “I believe they are considering the rise in tax credits, at least a narrowing of qualifying technologies.
“And they are looking at how to fund start-ups, particularly spin outs from university. I think we need a huge increase in the number of angel investors in Britain. We need to encourage people with what is a risky investment. We should be encouraging them with generous tax reliefs.”
Sir James also urged that the Enterprise Investment Allowance, which provides income and capital gains tax relief, should be “increased and skewed and biased towards development technology in manufacturing”.
The R&D tax credit system was introduced in 2000 and has so far given backing to over £50 billion of research and development.
In 2010, some 8,000 firms made use of the tax breaks.
It is thought that the Treasury is considering a more precise targetting of reliefs so that they help truly innovative enterprises.