Chancellor reveals West Midlands investment zone talks in revolutionary growth plan

Kwasi Kwarteng revealed talks are ongoing with areas across England to set up the new initiative, which he says will "support growth" by reducing taxes for businesses and cutting planning red tape.

The scope of the project is wider then first thought, with around 40 zones being considered.

It is believed the West Midlands Combined Authority (WMCA) wants to establish a zone along the Wolverhampton to Walsall corridor, while the stretch from Wednesbury to Brierley Hill has also been put forward.

Staffordshire is also being considered.

Announcing the measure as part of his growth plan, the Chancellor said that investment zones would bring "targeted action in local areas".

"I can announce the creation of new investment zones," he said. "We will liberalise planning rules in specified agreed sites, releasing land and accelerating development.

"We will cut taxes. For businesses in designated tax sites, for 10 years there will be accelerated tax reliefs for structures and buildings. And 100 per cent tax relief on qualifying investments in plant and machinery."

He added the Government was in early discussions with regions across England to establish the new zones, as well as the devolved administrations in Scotland, Wales and Northern Ireland.

"If we really want to level up, we have to unleash the power of the private sector," Mr Kwarteng said.

Wolverhampton Council leader Ian Brookfield said the investment zone scheme could open up "real potential" for the city.

He said: "We are working hard for investment from the Government and from overseas developers because we need jobs in our city.

"Jobs are the bricks on which we build everything else upon. We will look at any initiative and work with any government department and the WMCA to that end.

"We will be looking closely at the details of investment zones, but they could certainly be a new vehicle with real potential in our city."

As part of the plans, businesses in designated areas in investment zones will benefit from 100 per cent business rates relief on newly occupied and expanded premises.

Local authorities hosting investment zones will receive 100 per cent of the business rates growth above an agreed baseline in designated sites for 25 years.

Additionally, businesses will receive full stamp duty land tax relief on land bought for commercial or residential development and a zero rate for employer National Insurance contributions on new employee earnings up to £50,270 per year.

To incentivise investment there will be a 100 per cent first year enhanced capital allowance relief for plant and machinery used within designated sites and accelerated enhanced structures and buildings allowance relief of 20 per cent per year.

It is understood the Government is looking to open up an initial 12 investment zones, with more to follow. Ministers are also planning to allow local leaders to influence how particular zones operate.