You may have heard the news that the Solent is one of eight contenders given ‘freeport’ status. The announcement was made in the Autumn Budget 2021 by Southampton-born Chancellor Rishi Sunak who has championed the freeport idea.
So what is a freeport?
According to the government, freeports are “special economic zones with different rules to make it easier and cheaper to do business”, As part of the levelling up agenda, the aim of freeports is to create jobs, increase international trade and investment and serve as hubs for innovation.
How does this help local business?
The area given freeport status will have a defined site within which freeport tax relief will apply – operating in a similar way to existing Enterprise Zones. It will benefit from tax reliefs, simplified customs procedures, streamlined planning processes to boost redevelopment and government support to promote regeneration.
Put simply, freeports will see the usual customs rules, planning policies and business taxes lifted. Businesses will be able to import materials and components and then export them without the normal tariffs or regulation.
Freeport tax reliefs and incentives
Eligible businesses located within the Solent freeport zone (an area of approximately 30 miles of around Hampshire) will have access to a number of tax reliefs including Business Rates, Stamp Duty Land Tax (SDLT), Employer National Insurance Contributions (NICs), Enhanced Structures and Building Allowance and Enhanced Capital Allowances.
Customs
Businesses operating within the Solent freeport customs sites will have access to simplified customs arrangements with favourable tariffs, VAT and duties.
Declarations
Declaration requirements will be simplified to reduce the administrative burden of moving goods into the freeport. Businesses must use form C21 to make a customs clearance request to allow goods to leave the port.
Innovation
Innovative firms seeking to develop, test and apply new ideas and technologies will receive support to help them navigate regulation and minimise bureaucracy through a Freeport Regulation Engagement Network.
What does this mean for the Solent area?
The government is investing more than £2bn in the region. According to the Solent Local Enterprise Partnership (LEP) – which submitted the Solent freeport proposals to the government – its plan could generate 50,000 jobs, more than half of them in the Solent area, in sectors including maritime, science and research, logistics and defence.
You can find out more by visiting the Solent Freeport website at https://solentfreeport.com