The voice of the Welsh food and drink industry
The FDF is the membership body for the food and drink manufacturing sector. We represent and support food and drink companies, from ambitious sole traders and SMEs to the largest global brands. We respond to the issues and challenges shaping the world in which you operate, equipping our members with the opportunities and expertise to develop, grow and sustain their businesses.The voice of the Welsh food and drink industry Join FDF
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Updates for Welsh food and drink manufacturers
Non-Domestic Rates (NDR) linked grantsUpdate
The First Minister announced on 12 March additional Non-Domestic Rate linked grants. The additional support will help businesses in the hospitality, tourism, leisure and non-essential retail sectors that pay non-domestic rates and will operate as a top up to the Restrictions Business Fund.
The application window will close at 5pm on 31 March 2021.
Extra £150 million to support businesses in WalesUpdate
A further £150 million has been made available to support Welsh businesses in dealing with the continued impact of the coronavirus pandemic.
Last week, Welsh Government said the funding would be confirmed pending today’s regulations review. The additional support will help businesses in the hospitality, tourism, leisure and non-essential retail sectors that pay non-domestic rates and will operate as a top up to the Restrictions Business Fund.
This will see an eligible business with a rateable value of £12,000 or less receive an extra £4,000 grant payment. Firms with a rateable value of between £12,001 and £500,000 will receive £5,000.
The funding, which will help businesses with their costs up to 31 March, will be available to firms regardless of the number of employees and ensures micro businesses benefit from the support. Local authorities, will again be administering and distributing these payments.
Businesses that pay non-domestic rates and have already received a payment since the firebreak in October do not need to take action. However, businesses that have not registered with their local authority, should take action now to ensure they receive the financial support they are entitled to.
Today’s announcement builds on the rates holiday for eligible businesses in the retail, leisure and hospitality sectors in Wales which has been extended for a further 12 months.
Budget highlight a stand out initiative to encourage investment by food and drink manufacturers
While the range of fiscal measures announced as part of the Budget are always of interest, as a former MD and CFO of a food manufacturing business, I was particularly listening out for any announcements which would encourage our sector to invest in efficiency. As I see it, investment in automation, digitalisation and new technologies are key, given the UK’s uncompetitive levels of productivity in the past few years.
Throughout the pandemic, there have been winners and losers. With most of the sector made-up of SME businesses, the need for stimulus has been magnified, with any weaknesses in business and supply chain resilience only strengthening the case for investment. When combined with the lower profit margins, prevalent in the sector, the financial case for investment is often difficult to make.
Wednesday’s announcement of a Super Deduction Capital allowance is exactly the type of measure that can help our sector to invest and thrive as we look to the future. It is interesting too that the Chancellor notes that it had “never been tried before.”
In essence, it means that in the next two years, when companies invest they can reduce their tax bill by way of a super deduction of 130% against the cost.
From 1 April 2021 until 31 March 2023, companies investing in qualifying new plant and machinery assets will be able to claim:
- a 130% super-deduction capital allowance on qualifying plant and machinery investments;
- a 50% first-year allowance for qualifying special rate assets.
The super-deduction will allow companies to cut their tax bill by up to 25p for every £1 they invest.
While we await to see further detail, it’s an opportunity that should be of interest to senior exec in the food and drink industry. We will be studying the detail with interest!
Chief Executive FDF Cymru