Britain Announces Big Tax Breaks
LONDON (AP) _ Britain’s ruling Labor Party announced plans Tuesday to give big tax breaks to individual shareholders and large companies that invest in growing enterprises.
Treasury chief Gordon Brown, declaring that the 2 1/2 year-old Labor administration has curbed both inflation and unemployment, pledged to avoid a state spending spree _ despite a budget surplus of $15.4 billion this year.
To encourage investors and risk-taking entrepreneurs, Brown said capital gains tax on profits from stock sales _ now mostly 40 percent _ will be slashed to 22 percent for three-year investments, and 10 percent for five-year investments.
Big companies investing in growing enterprises will get tax relief of 20 percent, Brown added. Details of the company program will be announced Wednesday.
In addition, under a new employee share ownership program, shares held by workers in their company for five years will be exempt from tax and capital gains.
``This government is demonstrating that enterprise and fairness can go hand in hand,″ Brown told the House of Commons in his annual statement setting forth growth forecasts and tax changes to be implemented in the annual budget this spring.
While business and trade union leaders welcomed the share ownership moves, the opposition Conservative Party dismissed Brown’s statement as a headline-grabbing exercise, aimed at diverting attention from the tax hikes implemented by Prime Minister Tony Blair.