Pharma reaction to UK Spring Statement 2022

24 March 2022

As well as offering a batch of proposals to relieve households facing a crippling cost of living crisis, UK Chancellor Rishi Sunak’s Spring Statement yesterday included a number of relevant announcements for the pharmaceutical industry. These included:

Tax plan: The government will develop a Tax Plan with the intention of cutting and reforming business taxes, to create a new culture of enterprise and the conditions for private sector-led growth.
R&D tax relief reform: Confirmation that from April 2023, all cloud computing costs associated with R&D, including storage, will qualify for relief.
- The government will legislate to ensure that some R&D that is conducted overseas will remain eligible where it is necessary – including where activities must take place outside of the UK, for example, clinical trials.
Research and Development Expenditure Credit: To ensure the effective targeting of the UK’s R&D relief the government will consider increasing the generosity of RDEC to boost R&D investment in the UK. This would rebalance the schemes and make RDEC more internationally competitive.
Apprenticeship levy: A commitment to examine whether the current tax system – including the operation of the apprenticeship levy – is doing enough to incentivize businesses to invest in the right kinds of training.

Responding.to the statement, Richard Torbettt, chief executive of the Association of the British Pharmaceutical Association (ABPI), said: "Innovative sectors like the pharmaceutical industry will be central to the Chancellor’s plan to innovate more, lift growth and deliver a faster-growing economy.

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