Businesses and entrepreneurs should prepare to be underwhelmed by this year’s Budget after it was announced that the Chancellor would be delivering his economic policies for the coming year on Wednesday March 24.
With the UK imminently set to go to the polls, this year’s pre-election budget is likely to be short on detail and ‘big-ticket’ policies but there is still scope for extending measures to assist the region’s private businesses and wealth creators, according to Chris Romans, tax expert at PwC in the Midlands.
Speaking as the chancellor confirmed the date for this year’s budget, Mr Romans said: “With a general election around the corner and a series of new taxation measures already set to come into force in April, it is unlikely that this year’s budget will contain any major surprises with income tax or other headline tax rates.
“However, there is still scope for the chancellor to continue a number of initiatives that have already helped the region’s private businesses through the downturn. These include extending the ‘time to pay’ scheme, first year tax allowances for plant and machinery and R&D relief, which has proven particularly beneficial for small and medium-sized businesses in the region.
“Looking beyond the election, the potential to reduce the current disparity between capital gains tax (CGT) and income tax is highly likely to be on the radar of any new government. Any changes in this area will need to be carefully thought through, so as not to discourage investment in the longer-term.
“Furthermore, future policymakers will need to be mindful of the potential knock-on effects of further taxing the region’s wealth creators. While the UKcontinues to be broadly on a par with its major European counterparts in terms of its attractiveness as a place to do business, any additional taxation measures could see this position eroded.”