With just under a week until the Autumn budget what are we likely to see from this year’s?!
In the words of Matthew Lynn, a journalist for the Telegraph Business, it’s becoming a bit like the first world war. An assault each autumn, all the while neither side seem to be getting anywhere, other than getting even more stuck in the mud.
Let’s not forget this is the penultimate budget pre-Brexit so the pressure does seem to be on for old Phillip.
It’s all about the Young’uns
It’s been no secret that in the most recent election the majority of younger voters were labour supporters and, so it seems, these are the people the chancellor needs to get on side.
But will Philip Hammond risk his rapport with the older voters – some of whom are a dead cert – in a bid to obtain the younger ones?! A rumoured reduction in NI rates for people in their 20s and 30s needs to be funded somehow and I’d say reducing tax relief for pensions could be a risky move.
Currently we pay around 12p for every £157 we earn in NI, this is another threshold that could be raised as well as the higher rate threshold moving from £45K to £50K. That’s an extra £1000 in your pocket if you’re lucky enough to be on that type of wage. Not forgetting the £100 a year with the increase of the tax-free allowance.
He has already come under fire about promises the previous chancellor made, such as the tax free allowance reaching £12,500 by 2020.
So, you are the Chancellor and you want to try attract the younger voters, where do you start?! I would say university fees. On average, people are leaving university with over £50,000 in debt, most of whom won’t pay this off within the 30 year time limit. So what is the point?!
If the government aren’t going to get the money, why not reduce the debt rather than writing it off every year. Win for the government, who have a better chance of actually receiving their debts all the while getting the votes from students who also think they are winning because they’re going to uni at a bargain price.
It has also been said that the Chancellor may cut tax breaks for long term investors too in a bid to woo younger voters.
Go careful there Phil, don’t want to upset the majority to gain the minority.
There is rumour that greenbelt planning may be scrapped all together to allow a boost in housing.
This would work to improve the construction industry, in turn producing CIS for the government and the incentives will no doubt include government backed funding for the developments and those wishing to buy a house on them, likely to be younger people. Can you see the theme?!
To finish off, as usual when it comes to a budget, backtracking is ALWAYS a trend and with the stamp duty reportedly freezing the housing market, some sort of break could be a possibility.
it’s recently come to my attention that our VAT threshold is over 4 x the European average.
Great for our businesses at the moment but imagine the potential gains available to the government if it was lowered by just £10,000. I have a feeling there will be some mention of this.
Once again, not forgetting the previous promises made of lowering corporation tax means the government has to recoup the money somehow!
Obviously all of this is speculation and when we take a step back, is there ever a solution that would make the masses happy? Probably not.
But will the chancellor risk it by focusing on taking from the old to give to the young?
Talk to us today, about accounting for tomorrow.
Next Blog: Wednesday 22nd November 2017 ‘2017 AUTUMN BUDGET’