From CNBC: 2024-11-01 05:10:36

UK Finance Minister Rachel Reeves announced plans to increase capital gains tax (CGT) rates, raising the lower rate to 18% and the higher rate to 24%. The lifetime limit for business asset disposal relief (BADR) will be £1 million. Tech execs and investors express concerns about potential impacts on hiring and inflation.

Another tax increase announced by Reeves is for carried interest, with the rate rising to 32% from 28%. European venture capital firms worry that these tax hikes could hinder the growth of tech giants like Nvidia in the UK. Further consultations on tax reforms for carried interest are expected.

The UK government plans to mobilize £70 billion through the National Wealth Fund to boost investment in technology. Industry leaders are encouraged by the government’s commitment to long-term growth through technology investments. Calls for diversification of pension fund investments into riskier assets like venture capital to support the tech sector.

CEOs of UK businesses, like Steve Hare of Sage, acknowledge the challenges posed by tax hikes and rising employer contributions. However, they appreciate the clarity provided by the budget, enabling businesses to plan effectively. Tech entrepreneurs, like Sean Reddington of Thrive, express concerns about increased costs and hiring decisions, calling for government support to offset new burdens.

Read more: UK bid to take global tech crown in doubt after Budget