IT experts welcome emergency budget

The chancellor has been criticised for his austerity budget, but not by the IT industry

Senior figures in the IT community have welcomed chancellor George Osborne's emergency budget, despite the absence of any explicit references to technology in his speech to the Commons yesterday.

The new government's first budget scrapped Labour's 50p landline tax intended to pay for the rollout of broadband in rural areas. Downing Street also pledged to reduce corporation tax by one per cent each year, and to cut it to 20 per cent for small companies.

Osborne came good on his pre-election pledge to scrap the planned rise in employer National Insurance (NI) contributions, the so-called 'jobs tax', and stated his intention that new businesses will be exempt from paying up to £5,000 of NI contributions for the first 10 employees.

Matthew Poyiadgi, European vice president at IT industry body CompTIA, said that he was pleased with the apparent focus on increasing employment and driving innovation.

"Given that IT is arguably the single biggest lever for productivity and competitiveness in the UK, such policies should have an important impact on the industry," he said.

"These announcements create an improved environment for entrepreneurs to start the technology businesses that are so critical to our country's future."

The NI exemption for the first 10 employees of new businesses will encourage them to "recruit, train and certify young people" in IT, according to Poyiadgi, creating "a pool of professionals who can drive innovation in this lucrative area, and create the products and systems that will secure the country's economic future".