What can be predicted for the Chancellor’s Budget on 29 October is that it will be light on giveaways and heavy on any measures that can scrape more into the Treasury war chest, particularly with the cost of Brexit, possibly with an additional year of payments to the EU, looming. Leaving Europe is already estimated at costing every UK household some £870 per annum.
There may be a few measures that will directly affect the rural economy, and others where the rural economy, whilst not directly in the firing line, will feel the impact. A number of proposals have been given airtime.
A fuel duty freeze for the ninth year in succession would be broadly welcomed.
A 3 per cent surcharge on Stamp Duty Land Tax for overseas buyers might have some consequences for the landed estates and country homes market, as well as for London properties although, at the top end, such additional penalties should be no disincentive for those with significant, available funds to buy.
The prospect of a CGT dispensation (either a reduction or total get out) for landlords selling to long-term tenants may prompt some release of property. One suspects however that for rural landlords, unless they are looking to cash in for other reasons, they would rather keep their portfolio intact until the uncertainty surrounding Brexit and its impact on the property market has become better understood.
A number of options are available to the Chancellor needing to scoop more into the tax coffers and one cannot overlook a number of options that have been circulating to date: a penny on income tax, an increase in Capital Gains Tax rates, charging National Insurance on the earnings of those who continue to work after retirement age, or slashing the VAT threshold to £43,000 (which is quoted as potentially raising as much as £1.5billion) would all be radical.
David Chismon, Partner at Saffery Champness Chartered Accountants in Bournemouth and a member of the firm’s Landed Estates and Rural Business Group, advised, “What we badly need in these uncertain times are measures that encourage business development, promote business growth, and ease business succession from one generation to the next, although one has to consider any giveaways on these fronts are unlikely in such uncertain times – and even though an end to austerity is now being claimed.”
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