UK's economic health in spotlight as chancellor gives budget update amid Brexit chaos
PUBLISHED: 17:50 12 March 2019 | UPDATED: 17:52 12 March 2019
The chancellor's spring statement will no doubt be overshadowed by the Brexit debate, but could be a good indicator of the UK's economic health, a Suffolk finance expert suggests.
Jason Fayers, managing partner at Ipswich-based accountancy firm Scrutton Bland said the ‘mini budget’ could be a chance for chancellor Philip Hammond to spring some surprise to help boost an economy that, largely due to Brexit uncertainty, has almost stalled.
“The end of austerity was announced in 2018 and with the news that January 2019 was a record monthly surplus for government finances, Philip Hammond could have some room to play with when it comes to public finances. Additional funding for the police, education and social care could be set out,” said Mr Fayers.
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“Measures to combat climate change and to protect the environment using the market economy model may be expected, looking at low carbon heating, a high standard of energy efficiency in new homes and greener transport.
“The government are currently at the beginning of a five year period which aims to raise an additional £2bn of tax by tackling aggressive tax avoidance.
“There are specific targeted areas including off-payroll working, with new IR35 rules coming into effect next April and the current clampdown on disguised remuneration. There could well be further measures announced to challenge more artificial transactions aimed at minimising tax.”
There have been significant changes to pensions in recent years and given the current level of protest from all sides, it seems unlikely that any significant changes to pensions will be announced, Mr Fayers predicts.
But with Making Tax Digital for VAT coming in from the start of next month, there could also be further announcements on the future roll out to other taxes.
“Income Tax and National Insurance, as well as Corporation Tax are all set to be added to the quarterly reporting system in the years to come and we may hear exactly when these will come into force,” he said.