• silicon.com
• Management
• CIO Insights

By Sarah Left, 22 March 2000 00:20

NEWS Chancellor Gordon Brown promised a budget for ecommerce, and yesterday he proceeded to set out a raft of measures designed to turn the UK into an ecommerce economy and "catch up with the US". He announced capital gains tax cuts to increase investment in high-tech enterprises, and made changes to tax rules to reward the employee share schemes that are so crucial to dot-coms. The new Enterprise Management Incentive (EMI) scheme will let high-tech companies offer 15 of their key employees up to £100,000 in share options, tax free. But John Browning, co-founder of First Tuesday, was unimpressed. "It's a small step in the right direction, but only a small step, when a big step was needed," he said. Browning expressed his disappointment that the EMI scheme in his view skimped both on the amount of money available and the number of employees who can benefit. "You look at the number of millionaires that Microsoft or Yahoo! made - the average employee at Yahoo! made £9m," he explained. "If you want bold change, you have to change boldly, and he just didn't." The majority of employees with share options in dot-coms will be left wondering how they might benefit, as unapproved share schemes have been referred to the Financial Secretary for further consultation. Small businesses in particular stand to benefit. A permanent 40 per cent capital allowance is designed to encourage business investment by SMEs, and they will be able to write off 100 per cent of the costs of getting online. Also announced today were work permit reforms that will make it easier for UK businesses to recruit staff with high-tech skills from overseas. Businesses filing tax returns electronically will receive a £100 tax cut.