Investment Zones
The government will work with the devolved administrations and local partners to introduce Investment
Zones across the UK. Investment Zones aim to drive growth and unlock housing. Areas with Investment
Zones will benefit from tax incentives, planning liberalisation, and wider support for the local economy.
The specific interventions in Investment Zones will include:
• Lower taxes – businesses in designated sites will benefit from time-limited tax incentives.
• Accelerated development – there will be designated development sites to deliver growth and
housing. Where planning applications are already in flight, they will be streamlined and we will work
with sites to understand what specific measures are needed to unlock growth, including disapplying
legacy EU red tape where appropriate. Development sites may be co-located with, or separate to, tax
sites, depending on what makes most sense for the local economy.
• Wider support for local growth – for example, through greater control over local growth funding
for areas with appropriate governance. Subject to demonstrating readiness, Mayoral Combined
Authorities hosting Investment Zones will receive a single local growth settlement in the next
Spending Review period.
Specified sites in England will benefit from a range of time-limited tax incentives over 10 years. The tax
incentives under consideration are:
• Business rates – 100% relief from business rates on newly occupied business premises, and
certain existing businesses where they expand in English Investment Zone tax sites. Councils
hosting Investment Zones will receive 100% of the business rates growth in designated sites
above an agreed baseline for 25 years.
• Enhanced Capital Allowance
– 100% first year allowance for companies’ qualifying
expenditure on plant and machinery assets for use in tax sites.
• Enhanced Structures and Buildings Allowance – accelerated relief to allow businesses to reduce
their taxable profits by 20% of the cost of qualifying non-residential investment per year, relieving
100% of their cost of investment over five years.
18 The Growth Plan 2022
• Employer National Insurance contributions relief – zero-rate Employer NICs on salaries of any
new employee working in the tax site for at least 60% of their time, on earnings up to £50,270 per
year, with Employer NICs being charged at the usual rate above this level.
• Stamp Duty Land Tax – a full SDLT relief for land and buildings bought for use or development for
commercial purposes, and for purchases of land or buildings for new residential development.
The Department for Levelling Up, Housing and Communities will shortly set out more detail on the
planning offer. This will include detail on the level of deregulation and the streamlined mechanism for
securing planning permission.
The government will deliver Investment Zones in partnership with Upper Tier Local Authorities and
Mayoral Combined Authorities in England, who will work in partnership with their relevant districts and/
or constituent councils. All Investment Zone agreements will contain tax and development sites. Areas
will be responsible for putting forward sites and demonstrating their potential impact on economic
growth, including by bringing more land forward and accelerating development.
Investment Zones will only be chosen following a rapid Expression of Interest process open to everyone,
and after local consent is confirmed. However, examples of illustrative sites that may have the potential
to accelerate growth and deliver housing in the way the Investment Zone programme envisages can be
found in Annex A.
The government is in early discussions with 38 Mayoral Combined Authorities and Upper Tier Local
Authorities who have already expressed an initial interest in having a clearly designated, specific site
within their locality. A full list of these 38 authorities is available in Annex A.
The government will deliver Investment Zones in Scotland, Wales and Northern Ireland and intends
to work in partnership with the devolved administrations and local partners to achieve this. The
government will legislate for powers to create tax and development sites in Investment Zones where
powers are reserved.
The government remains committed to the progress of the Freeports programme. The government will
work with local partners involved in current and prospective Freeports to consider whether and how the
Investment Zones offer can help to support their objectives, as part of the wider process for identifying
Investment Zones. This will ensure that both programmes complement one another
