The first Budget of the new majority Tory government will be on Wednesday March 11, and we are planning to hold an event to tie in, with some expert comment on Chancellor Sajid Javid’s announcements.
In the meantime, here are a few predictions for what we think might and might not be put in the spotlight.
We have a Conservative government which, in the runup to the Election, made various spending promises, including a commitment to putting more money into the pockets of the less well off. This ties in with PM Boris Johnson’s pledge to show appreciation for the ‘loan’ of votes from traditional Labour voters in the North and Midlands.
We think the lower paid may benefit from cuts in tax and National Insurance contributions. There could also be reductions in employers’ NI contributions.
The cancellation of a planned reduction in Corporation Tax to 17% has already been announced, so this is likely to remain at 19%.
Will the Chancellor revisit the VAT threshold? Currently, businesses need not pay VAT until turnover reaches £85,000. Former Chancellor Philip Hammond considered changing the threshold but shelved the plan due to a backlash. We don’t, however, predict that any change will be made to the current VAT rate of 20%.
There may be changes to Inheritance Tax rules, tying in with the government’s commitment that people should not have to sell their houses to pay for social care.
To boost the housing market, the Chancellor may make changes to Stamp Duty Land Tax.
Businesses will be paying close attention to any announcement on Business Rates, especially those not qualifying for Small Business Rate Relief. We would like to see the Chancellor make favourable changes here.
Finally, there will be no tax rises, as the government has promised it is giving money away. As usual, however, the devil will be in the detail once the full Budget papers are published.
You can find more information here about our Budget event and all the other events we host at Optimum, including our free breakfasts.
If you’d like to speak to our accountancy or legal team, please get in touch.