Fears over balance sheets in spite of tax help Big business was delighted by George Osborne's surprise extra cut in corporation tax and his plan to reduce the top income tax rate, but there was unease among smaller businesses and manufacturers that the chancellor had not done more to remove barriers to growth. John Cridland, director-general of the CBI, the largest employers" group, said Mr Osborne had sent "a powerful signal to companies to invest, do business and create jobs in the UK." In a Budget that the chancellor said "unashamedly backs business," he also sought to boost selected sectors with measures such as £3bn in tax allowances for new North Sea investment, a tax credit for the video games industry and a £60m centre for aerodynamics. Mr Cridland said the extra 1 percentage point cut in corporation tax, which would reduce the headline rate down to 24 per cent from next month and 22 per cent by 2014, would help to "liberate" some of corporate Britain's estimated £700bn cash pile for investment. But manufacturers were concerned that the Office for Budget Responsibility had sharply reduced its estimates for business investment because it feared corporate balance sheets were not as strong as official data suggested. In the autumn statement, business investment had been forecast to grow by 7.7 per cent in 2012, 8.9 per cent in 2013 and 9.4 per cent in 2014. That has now been downgraded to 0.7 per cent in the current year, 6.4 per cent in 2013 and 8.9 per cent in 2014. In the medium term, the OBR said the new lower rate of corporate tax would boost business investment by around 1 per cent a year. "This year it doesn't look as though we will be making that much progress to a new economic model because we are now looking at business investment driving mucy less of the economic growth," said Steve Radley, policy director at the EEF manufacturers" organisation. The chancellor ignored the EEF's plea to introduce 100 per cent capital allowances for two years to offset the cost of new plant and machinery against corporation tax. Simon Walker, director-general of the Institute of Directors, said the chancellor had not done enough to remove barriers that were holding back economic growth. He welcomed the cut in corporation tax but said the planned cut in the top rate of income tax from 50 per cent to 45 per cent next year was a "fudge that will do little to combat the impression that Britain is a high-tax country, where ambition is not welcome." John Longworth, director-general of the British Chambers of Commerce, said small and medium-sized companies felt the Budget measures would "overwhelmingly benefit the biggest businesses" and were disappointed he did not do more to boost confidence across the economy. Against the cut in corporation tax, companies still faced a 5.6 per cent rise in business rates from April, lower allowances for capital investment and would get no further incentives to create employment, particularly for young people, he said.