Warwickshire accountant says businesses already looking to next government ahead of Spring Budget
Businesses are already looking past the Spring Budget and anticipating the next government’s actions, according to a leading Warwickshire accountant.
Phil Stevens, Head of Tax at regional accountancy firm Burgis & Bullock, says that many clients are beginning to assess and pre-empt measures which may be introduced if there is a change of government later this year.
Chancellor Jeremy Hunt will deliver the Spring Budget on Wednesday, March 6, and it is anticipated he may announce tax cuts in what would be the final Budget before a general election.
Phil said: “This is likely to be the last fiscal event before a general election and as such it is likely to be a very political Budget.
“The Autumn Statement was led with tax giveaways for businesses and workers, and early indications are that the Chancellor may look to lower taxes again if he is able to.
“However, many businesses and individuals we work with are already starting to look towards the next government and how areas such as capital gains tax, income tax and non-domiciled tax rates may be affected.
“Businesses want consistency and clarity, which is what they need to plan for the future. The majority of businesses are feeling the pinch in one way or another.
“Inheritance tax continues to be a topic of discussion in the lead-up to major fiscal announcements.
“This has been the case over several budgets and each time we thought there might be reform but to no avail. We feel changes are unlikely at this time as it is still seen as a tax of the wealthy, and it would be a politically dangerous step in election year to lower or abolish the tax .
“We may however, see a reversal of freezing of the individual personal allowance and/or increase in the basic rate threshold for income tax. There may also be further reductions in national insurance contributions.
There could also be decisions surrounding stamp duty land tax (for first time buyers) and changes to the LISA, with any amendments to these measures both providing a boost to the property market.
“For businesses, we don’t expect many changes as the Autumn Statement provided plenty of cuts and reductions. However, one area that has been discussed is in relation to the VAT registration threshold. The current system can discourage growth and sees some businesses look to stay below the £85,000 threshold, to avoid the 20% being added to their prices.
“This is a Budget which may have headline tax cuts ahead of the election, but any reductions will most likely be aimed at the general electorate and could mean that businesses are left without any boost, leading them to focus even more on the potential measures of the next government.”
