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As Phillip Jansen embarks on his final few weeks in office, he laid out his closing arguments in favour of BT tax breaks
BT’s CEO Philip Jansen has called for the UK government to implement permanent tax breaks for infrastructure investment.
In a plea to UK Chancellor Jeremy Hunt ahead of his upcoming Spending Review, Jansen explained that the introduction of a tax Super Deduction in April 2021 – which reduced tax on new plan and machinery equipment by 25% – had allowed BT to increase its fibre rollout targets from 20 million homes to 25 million homes.
Now, as economic hardship increased last winter and the Super Deduction measures have come to an end, the pressure to hit these targets has greatly increased.
Thankfully, the Super Deduction scheme was replaced in spring by a new policy of Full Expensing, allowing companies a 100% tax relief on qualifying plant and machinery investments between April 2023 and April 2026.
This measure has, according to Jansen, allowed BT to keep on track with its 25 million premises target, and increase its capital investment by £300 million per year.
However, the Full Expensing scheme is expected to expire in just over two years, with Jansen arguing continued private investment in telecoms infrastructure will be difficult without these tax breaks.
As a result, he is calling for the government to make these tax breaks permanent to ensure that the UK’s telecoms industry can make the additional investment of £20 billion to meet government fibre and 5G targets.
Further explaining how tax breaks are key for incentivising investment for large firms, Jansen added that it “would give businesses like BT Group genuine long-term certainty to plan and shift the investment environment in Britain from good to great.”
“I know the Chancellor is considering this as one option for next week’s Autumn statement. He has said he would like to take this step when the economic conditions allow. With billions of pounds of potential investment at stake, it’s also important to ask whether, as a country, we can afford not to,” continued Jansen.
Jeremy Hunt is set to announce his autumn statement on 22 November.
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