An Autumn Statement to Remember?
The days when an Autumn Statement consisted solely of tracking the performance of the economy against budget (its original purpose) are a distant memory. Whilst there isn’t last year’s dire need to reverse quickly out of the Truss Government’s tax announcements, there is the prospect of a general election next year (maybe as early as the Spring) to factor in. The outcome of recent by-elections may well panic the Government into doing something fiscal and radical. Certainly, this Prime Minister appears determined to ‘do the undoable’ whether that be cancelling HS2 or bringing back a predecessor as his Foreign Secretary.
So what might come up? Influential voices in the Conservative Party want preelection tax cuts – particularly to corporation tax – but the chances are that the Chancellor will wait until he knows how the economy is performing in the run up to the Spring Budget before doing anything drastic. A few months can be a very long time in politics (and economics). There has been speculation in the press that something significant will happen on inheritance tax – maybe even its abolition – but the lukewarm response may have put the Chancellor off any plans he had.
Something more likely, perhaps, to be promised as a pre-election inducement to re-elect the Conservatives!
Another idea trailed in the media is a revamp of individual savings accounts, so maybe that will be included. Then there is research and development relief. Surely, a Government anxious to
appear decisive won’t wait until the Spring Budget to announce whether or not a merged scheme will come into effect only a few weeks later. In fringe debates at their party conference, there were the usual calls for a reform of council tax valuations and re-evaluation of business rates, whilst some MPs put the case for the abolition of the high income child benefit charge and the extension of transferable personal allowances.
The Labour Party has committed strongly to VAT on private school fees but I’m not sure that the Conservatives will want to start a ‘my VAT policy is better than yours’ fight at this point.
The signs are that the Statement on the 22 November will be one to watch closely. What exactly it will consist of remains unpredictable. Maybe we will see some of the oft-promised tax simplification. That would really be a rabbit out of the hat.
Article written by Paul Robbins
