The Chancellor announced that he was going to be tough but fair in the budget today.
Everyone will have their own views on this. In particular public sector workers, who will feel most hard done by.
The main points for businesses and business owners are:
1. VAT is up to 20% from January next year.
2. Capital gains tax for higher earners will be up to 28% from midnight tonight (so stilll time to act!). When dealing with trustees and personal representatives care needs to be taken when considering in whose hands any gains are realised.
3. Entreprenuers' Relief for business assets (most significantly 5% or more shareholdings in trading companies) reducing CGT to 10% will remain and in fact will apply to the first £5m of gains realised over the seller's lifetime.
4. Capital allowances – the annual investment allowance will be cut to £25k.
5. The announced increases to tax on cider will be scrapped.
6. Corporation tax will be reduced over time. The main rate will be reduced over time to 24%.
7. A bank tax. Details are to be announced but the expected take from this is a couple of billion GBP. The Chancellor mentioned that Germany and France will announce similar measures.
There will be quite a few sales going through tonight to take advantage of the few remaining hours of 18% CGT.
We can also expect to see a rush to get purchases through (in particular of commerical property and of VATable assets by banks and financial institutions) before January's VAT increase.
As I sit down to review the pages of press releases and budget notes, it occurs to me that nothing in this is totally unexpected and that (so far as CGT is concerned, at least) it could have been worse.
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