We will implement key recommendations from Sir James Dyson’s Review into how to achieve our goal of making Britain Europe’s leading hi-tech exporter, including: encouraging the establishment of joint university-business research and development institutes; initiating a multi-year Science and Research Budget to provide a stable investment climate for Research Councils; creating a better focus on Science, Technology, Engineering and Maths (STEM) subjects in schools; and establishing a new prize for engineering.
 
Research and development tax credits will be improved and refocused on hi-tech companies, small businesses and new start-ups. At the same time, we will give strong backing to the growth industries that generate high-quality jobs around the country. We will improve the performance of UK Trade and Investment with a renewed focus on high priority sectors and markets where the return on taxpayers’ money is highest. We will regularly compare government support for exporters and inward investment against the services provided by our competitors. We will work for the successful conclusion of the Doha trade round and support bilateral free trade negotiations between the European Union and other countries.
 
Thirteen years ago, Britain’s tax system was one of the most competitive in the developed world. Over the last decade, other countries have cut their tax rates while our tax system has become one of the most complex in the world. Our competitiveness rating has fallen, while the burden of regulation and the impact of taxation have risen. We can only make a sustainable economic recovery if we send a clear signal that Britain is open for business again. That means stopping Labour’s jobs tax, lowering corporate tax rates, reducing the regulatory burden, and supporting innovation and sustainable development – changes that will benefit businesses of all sizes and boost employment.
 
The Conservative Party believes in lower and simpler taxation. That is why we will ensure that by far the largest part of the burden of dealing with the deficit falls on lower spending rather than higher taxes. Cutting the deficit is the most urgent task we need to undertake if we are to get the economy moving, but it is not enough. So, initially, we will cut the headline rate of corporation tax to 25p and the small companies’ rate to 20p, funded by reducing complex reliefs and allowances. To boost small businesses and life sciences start-ups, we aim to deliver 25 per cent of government research and procurement contracts through SMEs by cutting the administrative costs of bidding.