UK's biotech industry concerned about capital gains tax implications for the sector

The UK's Biotechnology Industry Association (BIA) says it has been exercised of late navigating all the changes wrought by the recent election and what it means from budgetary and policy points of view. In particular, it is giving a lot of attention to the present discussions surrounding possible changes to Capital Gains Tax (CGT) in the forthcoming budget, BIA chief executive Nigel Gaymond has told its members.

He said that the BIA is seeking to ensure that members - be they, entrepreneurs, investors or employees of high-tech, innovative, bioscience companies - are not adversely affected by unintended consequences of changes to CGT. This would include ensuring that existing schemes such as the Enterprise Management Incentive share option scheme is included within the reliefs for entrepreneurs. The BIA considers that share or share option investments in bioscience companies should be considered to be "good assets" which benefit from lower rates of CGT.

'We are concerned that a proposed increase to the rate of CGT could also have unintended consequences for bioscience SMEs [small and medium-sized enterprises]. In the past, the confusion caused by the proposed abolition of CGT Taper Relief was highly damaging for business confidence and Entrepreneurs Relief has been of limited impact in terms of encouraging investment to the UK,' Mr Gaymond warned.