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By Sally Watson, 21 March 2000 00:25

NEWS UK Chancellor Gordon Brown's annual budget must make bold tax allowances for high-tech firms if the UK is to become a global ecommerce leader, according to PricewaterhouseCoopers (PwC). The professional services organisation said the government should reduce corporate tax from its current level of 30 per cent to 20 per cent. Otherwise it risks the UK losing out to countries with lower tax rates, such as Ireland. PwC also called on the Chancellor to widen the eligibility for tax relief on research and development, and allow greater flexibility for employees with company share options. But according to Gary Cooper, research manager at the Butler Group, the government is unlikely to make the necessary allowances. "We've heard the government saying it wants the UK to be the ebusiness capital of the world, but it doesn't seem to be doing much to further that dream," he said. "We've got to look at tax incentives to encourage companies to go further. Small companies could be given tax relief on the first £30,000 they spend on setting up a Web site, for example. But I've heard nothing that encourages me to think the government is going to give anything back. "We could be missing an opportunity," Cooper added. "The government needs to give a lead - but I don't think they're going to do that." Brown is likely to make some significant changes to corporate share options and National Insurance payments, according to Richard Baron, deputy head of the Policy Unit at the Institute of Directors. "A lot has been announced already, or published in draft legislation, which is great, as it gives people the chance to comment." Gordon Brown is due to make his Budget announcement in the House of Commons at 15:30 GMT today. For the latest updates stay logged in to Silicon.com.