Chancellor’s statement about tax as well as spending

Chancellor of the Exchequer George Osborne.

Chancellor of the Exchequer George Osborne. - Credit: PA

Chancellor of the Exchequer George Osborne will be presenting his Autumn Statement on Wednesday which will outline how the government plans to cut the deficit as well its spending plans.

Details of the spending plans have already started to emerge – at the weekend it was revealed that the Chancellor would be giving £2 billion to the NHS to tackle some of its shortfalls.

However there were also claims from the opposition that some of this money was a re-announcement of earlier pledges.

While the road and rail announcements will go down well in the region, there are other requirements as well and there are concerns about how tighter austerity after the general election could affect businesses and individuals.

Mark Pendlington, chair of the New Anglia Local Enterprise Partnership, said: “We hope the Chancellor will announce more spending power for Enterprise Partnerships like ours.

“In July we were awarded £60m in new Government funding to support key skills and infrastructure projects, such as new relief roads in Bury St Edmunds and Beccles, new engineering and skills centres for three of our colleges, and £10m to deliver Superfast Broadband in rural areas across Suffolk and Norfolk.

“That funding will see a total of over £300m investment in the area to 2021. We have many more projects we want to fund as we stay on track to deliver on our targets for more jobs, new businesses and more homes and we believe we have a very strong case for more money coming to Norfolk and Suffolk.”

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As well as major infrastructure projects, the Chancellor is also expected to outline how he hopes to cut the growing government budget deficit.

Accountants Baker Tilly are not expecting major changes in the tax system in the run-up to a general election, even though the government has a significant deficit.

Melanie Reed, Tax Partner for Baker Tilly in Bury St Edmunds, said: “As this is the last Autumn Statement before the General Election, the Chancellor is going to struggle with attempting to balance vote-winning tax promises paid for by tax increases, with more cuts in services and increased borrowings.

“Mr Osborne needs to find annual savings of around £45bn, but even if the tax gap of £34bn didn’t exist and the UK’s tax system worked perfectly, then tax alone couldn’t fund any harsh new austerity measures. So any post-election tax giveaways that he announces now might mean be difficult to live up to later.”