Surely there is a good idea to use the tax system to give incentives to companies to move to high unemployment areas? And at the same time, give extra incentives for companies to export more goods to new markets.
First of all, if a company opens up a factory in an unemployment black spot, as designated by the Board of Trade, a series of incentives could be given. First of all, lower rates of Corporation Tax could be levied for the first ten years. And also Capital Gains taxes could be reduced for the same period.
In addition, a totally free “Employers Contribution” to National Insurance could be made for each employee who has (a) lived in the local area for a year or so, and (b) has been unemployed for over six months. And this should continue for the first five years.
Incentives for exporting to new markets are not quite so easy to assess. It is an expensive business travelling to, and opening up, new markets in countries you haven’t traded with before. I suggest that all sales to new markets have the entire gross profit for that market, taken out of the tax equation for the first five years.
I know that these lengthy terms are over the life of the Government’s term of five years but there is a precedent for politicians biding future Governments into decisions made on long tern projects. I am referring to signing treaties taking us further into the European Union.