As part of the Budget 2021 the Chancellor Rishi Sunak has confirmed that East Midlands Airport has been granted Freeport status in a move expected to support the creation of approximately 60,000 jobs in the region.
The move sees East Midlands Airport becoming one of the eight new freeports in England. Scotland, Wales and Northern Ireland are expected to announce their own freeport policies in due course.
The move was announced by Chancellor Rishi Sunak as part of the Budget 2021 outlining measures aimed to help the UK to tackle and bounce-back from the Covid-19 pandemic. The announcement was part of a three-point plan to protect and create jobs. Measures included an extension of the Covid-19 Job Support Scheme to September 2021 across the UK and an extra £1.65bn cash injection to ensure the Covid-19 vaccination roll-out in England continues to be a success.
What is a Freeport?
These are zones, usually airports or shipping ports, that are designated by the government. Goods that arrive into freeports from abroad are subject to little or no tax charges, called tariffs, that are normally paid to the government.
What does Freeport Status mean?
Companies operating within freeports can benefit from deferring the payment of taxes until their products are moved elsewhere, or can avoid them altogether if they bring in goods to store or manufacture on site before exporting them again.
In his Budget, Mr Sunak said they would have "different rules to make it easier and cheaper to do business".
In England, companies inside the sites will also be offered temporary tax breaks, mostly lasting five years. These include reductions to the tax companies pay on their existing property, and when they buy new buildings. Employers will also pay reduced national insurance for new staff.
For more information please contact our Commercial Property Team.