Autumn Statement 2014
On course, off course, of course…
At the end of his Autumn Statement to the House of Commons, George Osborne insisted that Britain is ‘on course to prosperity’ under his guidance. Naturally, his opposite number Ed Balls disagreed: he pointed out that current borrowing is higher than planned, and claimed that ‘working people are £1,600 a year worse off’ than they were when Mr Osborne took office. In the run-up to a General Election, they are both setting out their applications for the Chancellor’s job from May 2015.
The scale of the deficit left Mr Osborne little room for the kind of tax giveaways that might have preceded an election in the past. Perhaps he believes that the public no longer fall for them; perhaps he is saving something for the March Budget, when it might have a bigger impact. He still produced a long list of measures, many of them only touched on in the speech but described in more detail in the mass of documents that appear on the internet the moment the Chancellor sits down.
This newsletter describes the main taxation proposals and outlines their likely impact. Some are very sensible and long overdue, such as the reform of Stamp Duty Land Tax on houses. Some are more controversial, such as a power for HMRC to take money directly from a debtor’s bank account. Some come into effect immediately, such as the closure of an opportunity to save tax on incorporation of a business. And some may only come into effect if Mr Osborne is returned to his job in order to put all his proposals into legislation. Although Mr Balls objects to Mr Osborne’s plans in general, we don’t yet know how many of these proposals will be retained if Labour win in May.
At least one populist measure will take effect just in time to beat a change of government – from 1 May, children under 12 will be exempt from Air Passenger Duty, saving a family up to £71 for each young child. So anyone disappointed by the result of the election can emigrate more cheaply.
To continue reading the full report, please click here.