Autumn Budget 2018 to take place on Monday, 29 October
All pens are sharply drawn across the UK, as businesses are marking Monday, 29 October as one of the most important financial dates of the year: Autumn Budget 2018. With plans on the changes to tax and spending for next year formally announced, this is a crucial date in the financial calendar.
Following this year’s Spring Statement, it was confirmed that budgets will be delivered in Autumn rather than March or April each year. This year’s will prove to be a particularly significant Budget, as this is the final announcement before pivotal Brexit negotiations.
An earlier date than expected
It came as a surprise to many when Chancellor of the Exchequer Philip Hammond made the date announcement through a Tweet, and for good reason. Firstly, this was earlier than expected, as the date proposed is several weeks earlier than last year. Traditionally, such Budget announcements are given on a Wednesday. The last time such a fiscal event was held on a Monday was during the 2008 financial crisis, when a pre-budget report included an emergency cut in VAT.
However, set a week after the high-profile Brussels Brexit summit on 18 October, a confirmed factor for this date is to ensure it won’t clash with final stage of Brexit negotiations in November, thus giving parliament more time to debate and prepare for the Brexit negotiations. A Treasury spokesman confirmed to fit more accordingly with the ministers’ availability and other official data released.
What we know: a public healthcare approach
But of course, with a close split-vote by the UK public for a Brexit Britain, there is still resounding uncertainty and anxiety over what the budget announcement may bring. In making his date announcement, Mr Hammond confirmed he will: “set out how our balanced approach is getting debt falling whilst supporting our vital public services, and how we are building a stronger, more prosperous economy”.
Mr Hammond’s approach follows suit to a pledge made earlier this year by Theresa May, which set out to generate an extra £20bn funds to the NHS by 2023. Writing in the Sunday Telegraph, Jeremy Hunt held a candle to the governments’ promise, noting the plan would create an opportunity for the NHS “to write a completely new chapter in its history”.
Speculations about tax cuts and spending
Now, with undoubtable pressures for the government to maintain this scenario, many individuals and businesses are left wondering what cuts and impacts will be made to generate the funds. Unavoidably, taxpayers may expect to face increases upon delivery of the budget, and businesses could also be hit adversely by cuts to funds. However, we will not know the outcome of such speculations until the announcement.
Individuals and organisations have implored their own stances on how the funds should be allocated. For example, the Resolution Foundation think tank called on the chancellor to abolish Entrepreneurs’ Relief – a type of government funding developed by the Conservatives to encourage people to start their own businesses. If this was the case, some entrepreneurs looking to start their own business may not be able to get their idea off the ground. Adam Corlett, a senior economic analyst at the Resolution Foundation, said: “As the Treasury wrestles with how to raise revenues to fund the prime minister’s pledge of £20bn for the NHS, they should start by scrapping this expensive, aggressive and ineffective tax relief.”
Many small business owners will also have their fingers crossed it does not wobble their standing in the marketplace. For instance, the Federation for Small Businesses (FSB) has already earnestly implored for the Treasury to not make any changes to Dividend Allowance – which was already cut from £5K to £2K in the 2017 Budget alone. This was estimated to affect more than two million people in the 2018-19 financial year that had investments.
Of course, effects on individual taxpayers also goes hand-in-hand with the wider effects of social and cultural realms, and that of the wider business landscape. For instance, if pension relief was cut, this would have an impact on how people save and consume in general. As a business, or as an entrepreneur looking to start-up, it’s fundamental to keep track of these ongoing changes.
How TBL can guide you
At TBL, we stay up to date with the latest tax rates and spending announcements, details fundamental to your clients’ business and personal lives. To keep up-to-date with the most pertinent issues affecting your small business in the Autumn Budget 2018, stay up to date with our News and bookmark our Key Dates and Deadlines.