Chancellor of the Exchequer, George Osborne, delivered his Budget to the House of Commons today and focused largely on providing benefits to SMEs, including reductions in National Insurance and funding for external advice.
Small to medium sized businesses have been a core focus for the coalition government, particularly in London's Tech City, where the east end has seen investment to help support a flourishing technology start-up scene.
Osborne's biggest promise to SMEs in this year's Budget was what he dubbed a "tax off jobs", where every company in the UK will take the first two thousand pounds off their National Insurance bill.
"To help create jobs and back small businesses in this country I am today creating the Employment Allowance. It's a tax off jobs," said Osborne. "It's worth up to £2,000 to every business in the country."
He continued: "And it will mean that 450,000 small businesses - one third of all employers in the country - will pay no jobs tax at all. For the person who's set up their own business, and is thinking about taking on their first employee - a huge barrier will be removed."
According to the Chancellor, this means that a company can hire someone on £22,000, or four people on the minimum wage, and pay no jobs tax at all. He expects that 98 percent of the benefit of this new Employment Allowance will go to SMEs and will become available in April next year once the legislation is passed.
Osborne also announced a further reduction in corporation tax, where from April 2015 companies will only have to pay 20 percent in taxes - down one percent on the previous year. This 20 percent tax rate compares to 29 percent in Germany, 33 percent in France and 40 percent in the United States.
"Today, I want us to send a message to anyone who wants to invest here, to create jobs here, that Britain is open for business," Osborne told MPs.
"Britain will have a 20 percent rate of corporation tax - the lowest business tax of any major economy in the world. That's a tax cut for jobs and growth."
SMEs are also set to benefit from a substantial increase the value of procurement through the Small Business Research Initiative (SBRI) - which aims to address barriers to innovation for SMEs and help government departments engage with smaller business.
According to the Budget, "Under the SBRI, businesses compete for government contracts to develop new ideas with the potential to tackle public sector challenges. The government will substantially expand SBRI among key departments so that the value of contracts through this route increases from £40 million in 2012-13 to over £100 million in 2013-14 and over £200 million in 2014-15"
Sign up for CIO Asia eNewsletters.