The Spring Budget
The Spring Budget has highlighted the Government’s commitment to building a strong economy while investing in infrastructure, education and life-long learning, and protecting the NHS.
The Office for Budget Responsibility forecast that the UK economy will grow by 2% in 2017, slowing down in 2018, and then picking up to 2% again in 2021.
From a tax perspective, emphasis was placed upon tax avoidance and evasion, and the often-perceived imbalance in the tax system between the employed and self-employed tax rates. An example for the latter was the announcement that national insurance contributions for the self-employed will rise from 9% to 10% in April 2018 and to 11% in April 2019, while the tax-free dividend allowance will be reduced from £5,000 to £2,000 from April 2018.
The budget included strong business-focused plans to ‘make Britain the most attractive place to start and grow a business’.
The measures included plans to:
- reduce difficulties related to the R&D tax credit regime
- delay quarterly reporting required under ‘Making Tax Digital’ will be delayed by a year for those companies who have a turnover below the VAT registration threshold
- cut the corporation tax rate to 19% from this April and 17% in 2020
- provide a package of measures to help smaller businesses cope with business rate rises.