26 budget reaction
Upbeat Thames Valley unruffled by Budget
More than 250 business leaders met at Newbury Racecourse the day after the Budget to give their verdict on the chancellor’s announcements. Here we wrap up the reaction of the business community in the region
The Thames Valley believes the chancellor’s Budget, announced last month, will have negligible impact on business confidence – because it is riding high in any case.
At a post-Budget breakfast seminar staged by James Cowper Kreston, the 250-strong audience was asked whether the chancellor’s plans would increase business confidence. A majority said it would have no effect.
'This was a Budget for everyone
designed to appeal to as many voters as possible'
The audience was also asked about current business conditions. In a vote, 69% said revenues had increased in the past year; 59% had increased staffing numbers; and 63% reported an improved appetite for investment.
James Cowper Kreston also surveyed its clients prior to the Budget and found they wanted a low- tax commitment from the chancellor. They also wanted multi-nationals and large corporates to pay their “fair share” of tax; and they were strongly in favour of more superfast broadband.
Peter Whalley, partner, told the audience that George Osborne had pretty much followed the “James Cowper manifesto”. Osborne had painted a picture of UK growth of 2.6%, record employment, living standards higher than in 2010; and debt as a percentage of GDP falling from 80% to 72%.
'There was very little in the Budget to help mid-sized businesses'
Reacting to the Budget, the Federation of Small Businesses (FSB) has welcomed measures that should support already-robust confidence among its members.
David Hawes, Thames Valley regional chairman, said: “Our members will be encouraged by many of the announcements. The review into business rates is long overdue. When complete, it must deliver tangible benefits to businesses and not end up as just another report that sits on the shelf. His commitment to raise the Annual Investment Allowance to an appropriate level will provide the certainty needed for businesses to plan and invest – something badly needed if the UK is to raise its productivity.
“We are especially pleased that the idea for a single digital tax account is being taken forward. This is something we have long advocated – featuring prominently in our 2015 Business Manifesto. Implemented properly, this should reduce the time businesses take to complete their tax returns, and offers opportunities to deliver targeted support. The abolition of class two National Insurance contributions for the self-employed is also a welcome step.
“There were some helpful measures to help with getting connected. The extension of the superfast
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connection vouchers will help small businesses in more urban areas. We look forward to reviewing the details of the new digital communications infrastructure strategy. Access to superfast services is a key requirement for small businesses. Delivery of this strategy will be critical to future- proofing the national economy.”
Gareth Anderson, tax partner at EY across the Thames Valley and Solent, commented on the chancellor’s announcement of an investment of £40 million to develop ‘Internet of Things’ technologies: “The investment by the UK Government into continued research in this space is a welcomed announcement. However, the chancellor needs to remember both the risk and opportunities for the UK of the Internet of Things (IoT).
“The interconnectivity of people, devices and organisations in today’s digital world opens up many exciting new opportunities and the ability to create efficiencies across key areas such as health and social care. However, there remains a whole new playing field of vulnerabilities as traditional organisational perimeters erode and existing security defences come under increasing pressure, requiring a rethink in how organisations approach cybersecurity. Therefore it is imperative that the funding allocated by the Government not only supports the opportunities posed by the IoT but addresses the inevitable risks it also brings.”
David Brookes, tax partner at BDO LLP in the Thames Valley, said: “This was a Budget for everyone designed to appeal to as many voters as possible: low earners, high earners or businesses. With Britain growing ahead of its major international competitors and an election coming up so soon, it’s clear that the chancellor felt confident enough to splash out on a raft of mini-giveaways.
“But, as ever, George Osborne gives with one hand and takes with the other, planning to raise even more revenue from tax avoidance and a raid on the banks featuring at the top of the list.
“There was very little in the Budget to help mid- sized businesses. Despite building rhetoric behind the scenes, any suggestion of how HMRC may start to adopt a more considerate and focused approach to these businesses was missing. There was also very little in the way of incentives for the region’s mid-sized exporters. We would like to see much more for this engine room of the UK economy from whoever wins in May.”
THE BUSINESS MAGAZINE – THAMES VALLEY – APRIL 2015
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