Investment industry welcomes infrastructure tax break
The UK investment industry has welcomed the government’s exemption from withholding tax for interest on private placements, saying it could lead to £9 billion of new investment in infrastructure projects.
Following the government announcement in the autumn statement, Daniel Godfrey, chief executive of the Investment Management Association (IMA), commented: “The IMA’s members are major investors in UK businesses and infrastructure; having worked closely with members, we can announce that over the next five years Allianz Global Investors, Aviva, Friends Life, Legal & General, Prudential and Standard Life intend to make investments of around £9 billion in private placements and other direct lending to UK companies.”
Aviva said it would make an immediate allocation of £500 million to UK infrastructure, in addition to £500 million already allocated to the asset class in 2013 by Aviva. The previous allocation has been invested in a range of projects across the UK, including a £67 million loan to social housing units in Stoke-on-Trent, and a commitment to provide up to £600 million of senior funding to fund up to 46 schools in the UK over the next 12 months. Aviva Investors head of infrastructure fund management, Ian Berry, said: “We are delighted to announce an additional commitment to UK infrastructure and look forward to continuing our significant investment activity.”
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