The design industry has found little in this year’s Budget to protect it from the effects of what the Chancellor of the Exchequer yesterday called a ‘deepening world recession’.
‘The writing is now on the wall about how severe the recession is, and we are in for tough times over the next 12 to 18 months,’ says Ticegroup managing director Ian Cochrane.
Cochrane criticises the Budget for ‘not getting rid of red tape around employment law’ at a time when design businesses are looking to shed staff to stay afloat.
A further disincentive to entrepreneurs came in the guise of the hike in the highest rate of income tax, according to Kingston Smith W1 tax partner Graham Morgan.
‘The high earners in the sector will be gnashing their teeth in reaction to the hike in tax for their bracket,’ says Morgan.
However, design businesses are likely to welcome the freeze on capital gains tax at 18 per cent. The industry may also find some solace in a report published yesterday by the Treasury.
Operational Efficiency Programme: final report, co-written by Design Council chairman Sir Michael Bichard, pledges to ‘build a legacy of innovative design thinking and skills’ across the public sector.
For a full analysis of the Budget see the next issue of Design Week, online on Wednesday.