Don’t forget to put November 22nd in your diary. It’s the Chancellor’s first official Autumn Budget.
If you think that it seems like we have only just had a Budget you would be right. The first Budget of 2017 was in the Spring but the Chancellor has decided that Budgets should be at the end of the year rather than at the beginning of the year from now on.
So what might we expect to see in the Budget? Well as we have only recently had one Budget and as the Tories got a good slap on the face in the election, it’s unlikely that he will propose anything too far reaching.
Brexit will of course get a mention and no doubt there will be mention of further resources to be made available to continue the negotiations.
Making Tax Digital should be on the agenda and it would be useful to get some further clarification from the Treasury as to how this is going to work.
It has been suggested that Pensions will be a target. Currently basic rate taxpayers obtain tax relief at 20% whilst higher rate taxpayers can get relief at 40% or higher. Is this equitable? Well whatever your view, I think either limiting tax relief to the basic rate of tax or amending the tax relief to say 30% across the board must have crossed the Chancellor’s mind.
It is possible that pensions could suffer in any other number of ways. Whilst the Government claims to support saving for retirement it always seems to be Pensions that successive Governments have seen as easy pickings.
Changes to Stamp Duty also seem quite likely. The current system acts as a deterrent to a free flowing market and we have already seen a slow down in the housing market arguably as a result of the Chancellor’s tinkering with the tax system. It has been suggested that not only should first time buyers be exempt from Stamp Duty to help them get on the housing market, but also there should be some relief for the older population from Stamp Duty. A lowering of stamp duty for this age group could encourage them to downsize once their children have left, thus freeing up housing for younger families, which would have a further trickle down effect for first time buyers.
An interesting proposal put forward by the Association of Accounting Technicians is that Stamp Duty should be paid by the seller rather than the buyer. Since generally people buy more expensive houses than the one they leave, that would immediately have the effect of cutting the amount of stamp duty paid across the market. Furthermore it would be the person receiving the cash from the sale that would be paying the stamp duty rather than the person already struggling to get a mortgage on their next home.
Lets see what comes out of the red briefcase. The nation awaits!