Treasury improves broadband returns by 50%
In most areas of human effort, timing is an essential element of success. So BroadwayPartners either got lucky or got its timing right.
Yesterday it said it will use tax breaks available under the government’s Enterprise Investment Scheme to set up an investment fund to specialise in Final Third broadband projects. Today (7 July) the Treasury announced it is to consult on the EIS incentives, basically improving by 50% the rebate on investment income and doubling the total one can invest under the scheme.
In a press release today the Treasury said it was considering
- raising the rate of EIS income tax relief to 30% from April 2011;
- increasing the annual EIS investment limit for individuals to £1m from April 2012;
- increasing the qualifying company limits to 250 employees and gross assets of £15m for both EIS and VCTs (venture capital trusts) from April 2012;
- increasing the annual investment limit for qualifying companies to £10m for EIS and VCTs from April 2012; and
- consulting on options to provide further support for early-stage (“seed”) investment.
The new thresholds will allow many established and start-up network operators to tempt new investors with returns that are almost impossible to achieve on the stock market. And £10m is about what the government is going to give each county under the BDUK allocation.
Coincidence, or good timing?