Employers lobby for tax relief on IT investment


Employers lobby for tax relief on IT investment

Manufacturers are lobbying for tax relief on IT investment to close the gap in productivity between Britain and the US.

Lisa Kelly

Members of the Engineering Employers' Federation met with MPs and civil servants at the House of Commons this week to make their case before the publication of party manifestos for the forthcoming general election.

The federation is calling for 100% first-year capital allowances for IT investment and a tax credit for incremental increases in research and development spending.

Federation president Paul Lester said, "Increased investment in IT is fundamental to improving the productivity of the UK manufacturing industry. It is an integral part of modern manufacturing technology. Investment in IT and e-business has been the main driver of manufacturing growth across the US economy over the last decade. On an international playing field it is crucial that our companies have the same incentives to invest in IT as our competitors."

Richard Holway, a director of analysts Ovum, commented, "Industry is facing immense problems. There is not enough R&D in the UK. Anything that stimulates demand is to everybody's advantage."

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This was first published in March 2001


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