UK construction sector responds to Spring Budget
07 March 2024
The UK’s Construction Plant Hire Association (CPA) has said the decision to bring forward changes to the Full Expensing rules to bring leased equipment into the scheme is “a positive step” for the industry.
Chancellor Jeremy Hunt announced on March 6 that changes to the scheme, which allows companies to claim 100% capital allowances on plant and machinery investments, is to be brought forward.
Brian Jones, president, CPA, said, “The announcement by the Chancellor in today’s Spring Budget, that the government will publish draft legislation to extend Full Expensing to assets for leasing when fiscal conditions allow, is a positive step. However, it is vital we know what these fiscal conditions are and when they will be met.
“We urgently need a timetable of action for this legislation that sets out when CPA members can invest with confidence in new equipment and boost business investment and productivity.
Nick Ground, director, Construction Equipment Association, said while it is too early to tell if the change will help purchasers, it will benefit its members who lease equipment; “The danger is that the promised legislation may remain as a promise as the general election looms,” he said.
Meanwhile, the Government also announced a 5p cut in fuel duty and extended the freeze period by 12 months. Ground said this would be “welcomed” by the industry following a period of “unwelcome extra costs associated with the banning of rebated red diesel for construction purposes in 2022.”
“The announcement to freeze fuel duty will be welcomed. With oil prices volatile, and the wider economic outlook still uncertain, this is a positive move,” added Jones.