Emergency Budget - What Lies Ahead?
The new Chancellor George Osborne has confirmed the date for the emergency Budget to be the 22 June 2010, which fulfils the Conservatives pledge prior to the election to hold a Budget within 50 days of coming to power to show their intention to combat the £163bn deficit.
The Budget in June is being heralded as the most important Budget in years, but what will be announced and with a coalition government how many of the conservatives original plans have stayed intact? We already know a little of what will be included as some statements have already been issued but there is also much speculation over what else is to come.
A strong contender is the suggestion that VAT will increase to 20%, this is an easy way for the government to raise funds and simple for them to implement. It does not overly affect the business community providing business takes place with other VAT registered businesses and at least the new rate is easier to calculate!
Also being discussed is whether Personal Allowances will increase. The Lib-Dems proposed in their pre-election manifesto that they would increase Personal Allowances to £10,000 per individual, it remains to be seen whether this was a compromise point made by the Conservatives in the coalition agreement.
An announcement is also expected regarding National Insurance. The Tories originally intended to reverse labours previously announced 1% increase due from April 2011 but it is now thought that this may not be as likely.
Other areas where changes are expected include: Capital Gains Tax to be increased for non-business assets; a reform to the Corporation Tax system with a reduction in the headline rate; personal service company legislation commonly known as IR35 to be replaced and a review of taxation for non-domiciled individuals.
Whatever ends up being announced both individuals and businesses are likely to see some kind of affect and will need to consider their tax plans. At George Hay we will be holding a series of seminars immediately after the budget to provide advice on the changes. Details of the seminars can be obtained from this website
Biggleswade Chronicle - 4 June 2010