IoD publishes list of business predictions for 2018

IoD publishes list of business predictions for 2018

The Institute of Directors (IoD) has published a list of 14 business and economic predictions for 2018.

Image result for institute of directors publishes list of predictions for 2018In its publication, the IoD predicts that 2018 will be a year of ‘great change&squo; for UK companies. The business group’s predictions cover a range of key issues, such as taxation, Europe and trade, employment and the UK economy.

It speculates that the Treasury will attempt to tax self-employed individuals ‘more like employees’, and predicts that Chancellor Philip Hammond will launch a consultation on the matter in the 2018 Autumn Budget.

The IoD also predicts that, by March, the UK and the EU will have reached an agreement on transitional Brexit arrangements, and a written commitment will be made.

Meanwhile, the number of companies being formed will ‘continue to rise’ in 2018, the Institute speculates. Its latest survey on confidence amongst business start-ups revealed that UK entrepreneurs are entering into 2018 with a ‘positive attitude’ towards investment in their firm.

Commenting on the predictions, Edwin Morgan, Interim Director of Policy at the IoD, said: ‘2018 will be another big year for business. The ongoing Brexit negotiations will be playing on many business leaders’ minds, but it would be a mistake to think it’s the only show in town.

‘By the end of 2018, if decent progress is made in the Brexit talks, companies will hopefully be able to look forward to the coming years with greater clarity and positivity about where the UK is going.’

The IoD’s full list of predictions can be found here.

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Autumn Budget stamp duty changes will have ‘modest impact’, says lender

Autumn Budget stamp duty changes will have ‘modest impact’, says lender

In a new report, building society Nationwide has stated that the Autumn Budget changes to Stamp Duty Land Tax (SDLT) for first-time homebuyers will have only a ‘modest impact’ on housing demand.

Image result for Autumn Budget stamp duty changes will have modest impact says lenderChancellor Philip Hammond abolished SDLT for first-time homebuyers in England, Northern Ireland and, temporarily, for those in Wales, from 22 November. The abolition applies for individuals seeking to purchase a first home worth up to £300,000. Wales will receive devolved stamp duty powers in April 2018, when its Land Transaction Tax (LTT) comes into effect.

To assist those in London and other expensive regions, the first £300,000 of the price of a home valued at £500,000 will be exempt from SDLT for first-time homebuyers.

Different rules apply in Scotland, where the Land and Buildings Transaction Tax (LBTT) is applicable.

Commenting on the report, Robert Gardner, Chief Economist at Nationwide, said: ‘The decision in the Budget to abolish stamp duty for first-time buyers purchasing a property up to £300,000 (with relief for those purchasing a property up to £500,000) is likely to have only a modest impact on overall demand.

‘In many regions, first-time buyers already paid little or no stamp duty as the price of the typical first-time buyer property was below the previous threshold of £125,000.’

Meanwhile, the Office for Budget Responsibility (OBR) warned that the abolition of SDLT for first-time buyers could result in higher house prices, as prospective buyers will have more money to put towards a deposit.

Motorists ‘less likely to choose diesel cars’ following Autumn Budget tax changes

Motorists ‘less likely to choose diesel cars’ following Autumn Budget tax changes

A survey carried out by CLM Fleet Management has suggested that UK drivers are less likely to purchase diesel cars, following tax changes made by Chancellor Philip Hammond in the recent Autumn Budget.

Image result for Motorists 'less likely to choose diesel cars' following Autumn Budget tax changesThe Chancellor announced that, for new diesel vehicles registered after 1 April 2018 that do not meet the Real Driving Emissions 2 (RDE2) standard, a supplement will be charged on their First Year Rate, to the effect of moving up by one Vehicle Excise Duty (VED) band.

After the first year, vehicles with zero emissions will be exempt from the standard rate of vehicle tax, and other petrol or diesel vehicles will pay a standard rate of £140 a year. An additional rate will be added to the vehicle tax for all new vehicles with a list price of over £40,000.

59% of survey respondents stated that they would be less likely to purchase a diesel car as a result of the increase in VED from April 2018.

The Chancellor also announced that the diesel supplement will be increased from 3% to 4% from 6 April 2018, but will be removed altogether for diesel cars which are certified to the RDE2 standard.

The CLM survey also quizzed respondents over this increase: 62% said that the change will not impact upon their buying decision, with a further 17% stating that they would be less likely to choose a diesel car.

Commenting on the findings, John Lawrence, Managing Director of CLM Fleet Management, said: ‘We have already seen a steep decline in diesel sales this year as drivers have reacted to negative publicity around poor air quality and diesels. And these latest announcements look set to accelerate that process.’

View our 2017 Autumn Budget Report

Chancellor Philip Hammond delivered his 2017 Autumn Budget speech yesterday, outlining a range of tax and financial measures.

Mr Hammond’s speech unveiled a raft of amendments, including scrapping Stamp Duty Land Tax (SDLT) for first-time homebuyers, an increase in the personal allowance (PA) to £11,850 from April 2018 and concessions for firms affected by the business rates ‘staircase tax’.

Further details regarding the announcements made by the Chancellor featured in the official press releases. Our comprehensive Budget Summary outlines the key measures, including some of the less-publicised changes that may impact upon your business or personal finances.

For a detailed overview of the Autumn Budget information, please read our 2017 Autumn Budget Summary.

2017 Autumn Budget – what to expect

2017 Autumn Budget – what to expect

Chancellor Philip Hammond will deliver his 2017 Autumn Budget speech today at 12.30pm. We will be keeping you up to date on the key Budget announcements, and will be supplying a full summary which will appear on the site tomorrow morning.

Image result for 2017 autumn budget what to expectFollowing the release of new figures that revealed a rise in government borrowing in October, Mr Hammond faces an uphill battle in attempting to balance the books against a weakening economic backdrop.

In his Budget speech, the Chancellor is expected to announce a range of fiscal measures designed to help young people: Mr Hammond recently stated that it is ‘not acceptable’ that millennials are unable to get onto the property ladder.

As a result, many expect the Chancellor to announce a change to the way in which stamp duty land tax is charged for first-time homebuyers, with some experts predicting that Mr Hammond could scrap the tax altogether.

Meanwhile, others predict that the Chancellor will announce changes to income tax. He previously pledged to raise the personal allowance (PA) to £12,500 by 2020, and many anticipate that the PA could be frozen in today’s Budget speech.

The Chancellor is also rumoured to be considering a host of measures intended to help UK businesses, including an overhaul of the business rates system.

Following calls made by leading business groups, including the Federation of Small Businesses (FSB) and the British Chambers of Commerce (BCC), Mr Hammond may seek to stall the upcoming 3.9% business rates rise, due to come into effect from April next year, and look to abolish the so-called business rates ‘staircase tax’.

Furthermore, some industry experts believe that the government may also lower the VAT threshold, which currently stands at £85,000. However, the FSB has warned that reducing this threshold will ‘drain small businesses of time and money’, and create ‘a real drag on business output’.

TUC urges Chancellor to use Autumn Budget to ‘end wage squeeze’

TUC urges Chancellor to use Autumn Budget to ‘end wage squeeze’

The Trades Union Congress (TUC) has urged Chancellor Philip Hammond to use next week’s Autumn Budget to put an end to the ‘wage squeeze’ currently plaguing UK workers.

Official figures recently published by the Office for National Statistics (ONS) revealed that inflation ‘remained steady’ in October at 3%, with higher food prices being offset by lower fuel costs.

Image result for end wage squeezeMeanwhile, wage growth figures outlined that workers’ earnings, excluding bonuses, fell by 0.5% in real terms, when taking inflation into account. This represents seven months of negative pay growth.

Commenting on the new inflation and wage growth figures, the TUC called for Mr Hammond to ensure that UK workers are given a pay rise in the Autumn Budget.

Frances O’Grady, General Secretary of the TUC, said: ‘This is the seventh month in a row that prices have risen faster than wages. But ministers are still standing on the side-lines.

‘Running the economy is not a spectator sport – the Chancellor must have a game plan to give Britain a pay rise in next week’s Budget.’

The TUC also called for the National Minimum Wage (NMW) to be raised to £10 per hour ‘as soon as possible’.

Chancellor urged to remove age-related tax inequalities in Autumn Budget

Chancellor urged to remove age-related tax inequalities in Autumn Budget

In a new report, think tank the Resolution Foundation has urged Chancellor Philip Hammond to tackle age-related tax inequalities in the upcoming Autumn Budget.

Image result for Chancellor age-related tax inequalitiesThe Resolution Foundation has called for Mr Hammond to unfreeze working-age benefits in 2018 to help raise living standards for young families.

It also stated that, rather than adding new age-related inequalities into the UK’s tax system, the government should aim to tackle existing ones. As such, the Foundation suggested that UK workers of all ages should pay the same national insurance contributions (NICs).

The Resolution Foundation stated that equalising the tax treatment for workers of differing ages is progressive as ‘four-fifths of the revenues would come from the richest fifth of pensioners, with most unaffected’.

Commenting on the proposals, Laura Gardiner, Senior Policy Analyst at the Resolution Foundation, said: ‘In recent weeks the Budget run-in has focused on a looming economic downgrade and preparations for Brexit. But the Chancellor should remember the bigger picture and deliver a Budget that tackles one of the biggest challenges Britain faces – our failure to deliver living standards progress for young people today.

‘The Chancellor should avoid ill-advised tax cuts for the young. Instead he should remove existing age-related tax inequalities to help fund the unfreezing of working-age benefits next year.’

The Chancellor will deliver the Autumn Budget on Wednesday 22 November. Make sure you keep an eye on our website for coverage of the key announcements.