He said: "Inner cities are not no-go areas for new enterprise but places of untapped potential. The way forward for regeneration is to harness public and private sectors." The tax cuts included:
- Abolishing stamp duty in designated areas
- Cutting VAT to 5% on property conversions
- 150% tax relief for cleaning up contaminated land
- 100% capital allowances for reusing empty flats and shops
- Offering tax relief for firms investing in urban regeneration companies.
The statement received a cool response from the industry. Construction Confederation chief executive Stephen Ratcliffe said he was disappointed that Brown had not cut VAT on maintenance.
He said: "There was not much in it but we expected as much this close to an election. The Treasury has not given any proposals to counteract the black economy." Construction Industry Council chief executive Graham Watts disagreed, saying: "It is a very strong budget. So far, I am pleasantly surprised. The reduced rate for conversions and grants for church repairs are interesting steps towards a reduced rate on VAT on maintenance."