Spring Statement 2018
The Chancellor delivered his first Spring (and self-described “Tiggerish”) Statement this afternoon: an economic update, free of new tax and spending measures. In a move to have only one major fiscal event in each year, the traditional Budget will be presented in the autumn. A detailed Spending Review will take place in 2019, as scheduled.
Economic and Fiscal Forecasts
Claiming to see “a light at the end of the tunnel”, the Chancellor announced the Office for Budget Responsibility’s (OBR) GDP growth forecast of between 1.3% and 1.5% for each year to 2022, together with a forecast fall in inflation. Debt as a share of GDP is forecast to start falling in 2019.
Autumn 2017 Progress Update
The Chancellor provided an update on progress since his November 2017 Budget, including:
- The National Living Wage will rise to £7.83, from 1 April 2018;
- The next Business Rates revaluation will be brought forward to 2021;
- Allocations of £1.5bn of Brexit preparation funding; and
- Measures to tackle late payment of debt to small businesses.
Whilst not announcing any new tax measures today, the Chancellor did not disappoint tax professionals, who might otherwise be missing the Red Book. He has invited views on future changes to the tax system, including:
- Reducing single-use plastic waste through the tax system: a “litter levy”;
- VAT registration threshold: a call for evidence;
- Allowing Entrepreneurs’ Relief for Capital Gains Tax on gains made before dilution;
- A position paper on corporate tax and the digital economy;
- Alternative method of VAT collection – split payment to combat online VAT fraud; and
- Online platforms’ role in ensuring tax compliance by their users
If you should have any questions relating to the Spring Statement 2018, or if you wish to respond to any of their consultations, then please do not hesitate to contact Katharine Arthur, Partner and Head of Tax or your usual haysmacintyre adviser.