Budget success for the two Michaels

Prior to this week’s Budget, EMC Management Consultants’ Hove-based director Michael Pay (pictured below left) and Hove & Portslade MP Mike Weatherley (below right) submitted a proposal to the Chancellor of the Exchequer to extend Entrepreneurs Relief. 

Their proposal centred around the Government’s wish to extend employee ownership of companies and encourage investment in private enterprise to support entrepreneurship. The previous capital gains tax legislation, whilst generous to larger shareholders of private companies, resulted in holders of Enterprise Management Incentive (EMI) scheme options being penalised by increasing their tax rate from 10% to as much as 50%. At the same time it failed to allow small shareholders to benefit from the lower CGT rate of 10% eligible to larger shareholders.

Michael Pay’s document, supported by Mike Weatherley’s representations, resulted in David Gauke MP, Exchequer Secretary to the Treasury, writing to say that the submission would be used to inform policy making.

When the Chancellor, George Osborne, sat down in the House after presenting his third Budget on Wednesday, it was of little surprise, therefore, to see that he confirmed an extension to the Entrepreneurs Relief rules to capture holders of EMI share options.

Michael Pay said: “It is fantastic news for all the EMI option holders that their efforts for supporting their employers will now be rewarded by being eligible for the 10% Entrepreneurs Tax.”

He is now campaigning on the remaining part of his proposal to reward those small investors who support enterprise in the UK.

23 March 2012