Business investment in the haulage industry collapsed by 17.8% annually as the coronavirus pandemic ravaged the economy, analysis of latest official data by specialist tax relief consultancy Catax shows.
Total business investment in the transportation and storage sector fell to £2.6bn in the second quarter of 2020, down from £3.1bn in Q2 2019, latest ONS figures released yesterday show.
This was much less pronounced than the dramatic slowdown seen in the wider economy. Overall business investment across UK industry fell 26.1% in Q2 compared with the second quarter of 2019.
UK GDP shrank 20.4% in Q2, with widespread declines across all main sectors of the economy.
The picture has, however, improved more recently with the ONS reporting that GDP grew 8% in the three months to the end of August as lockdown measures eased, raising hopes of a steep recovery in investment.
Mark Tighe, CEO of tax relief consultancy Catax, comments: “This year has caught everyone off guard. The second quarter was when the pandemic really saw economies slamming on the brakes, with the national lockdown in the UK being announced on March 23, just before it began.
“However, the haulage sector has actually fared much better than other industries. Both the utilities and hospitality sectors saw business investment drop by more than half as coronavirus disruption got the country in its teeth.
“It will take some time for business investment to climb back to where it was at the start of the year, when the only threat on the horizon appeared to be Brexit negotiations. The speed of that recovery will depend very much on how long the second wave lasts and how much disruption is to come.”
Catax is the UK’s leading expert in specialist tax relief. Since launch, it has recovered more than £320m of tax relief for its clients in the areas of Research & Development, Capital Allowances, the Patent Box and the Remediation of Contaminated Land. www.catax.com