Appeal for super-deduction tax to support leasing options

Affordable leasing and short-term hire options are essential for logistics businesses to acquire the vital plant and machinery they need for their operations, according to Logistics UK.

From 1 April 2021 to 31 March 2023, the SDA enables companies to claim 130% capital allowances on qualifying plant and machinery investments, in effect, cutting a companies’ tax bill by 25p for every pound they invest in new equipment. While the measure was designed to benefit businesses financially and operationally, the legislation excluded leasing and short-term hire, which are some of the most common ways plant and machinery are acquired by businesses

Logistics UK public policy manager Denise Beedell, said: “The logistics industry has risen to the challenge of keeping the supply chain going in the face of unprecedented obstacles and rising costs; including leasing and short-term hire would provide much needed support to this vital sector now also working to meet the even more testing challenge of the transition to net zero.”

Finance & Leasing Association director general Stephen Haddrill, added: “The era of buying plant and machinery outright is long gone. It’s so much more efficient for firms to lease or hire-in what they need when they need it, but the super deduction allowance simply does not support the realities of how modern businesses operate. The Chancellor has a real opportunity here to nurture productivity by getting the newest, cleanest and most efficient plant and machinery into the hands of business owners.”