Blick Rothenberg’s Autumn Statement newsroom is up and running, providing tax commentary, technical analysis and an interview service for journalists before, during and after the announcement is made on 23 November.
Our experts are already looking at what the Chancellor could, should and shouldn’t do - see their comments on key topics below:
Stamp Duty Land Tax ("SDLT")
Property and buy-to-lets
- "The Chancellor could reduce SDLT, as well as change the bands and rates. After the rush in property sales in March, to beat the 3% SDLT increase, the housing market has slowed. The latest SDLT statistics suggest that over 40% of SDLT raised in the last quarter came from property transactions subject to the 3% surcharge. The current SDLT regime is acting as a deterrent to people moving." Nimesh Shah, partner.
- "We believe that the Chancellor should reverse the proposed interest relief restrictions as the additional tax cost is expected to be passed on to tenants. A similar tax policy has recently been scrapped in Ireland. He should also overhaul the current tax system to encourage more movement in the property market. " Nimesh Shah, partner.
- "With regards to property and buy-to-lets, the Chancellor should do the following:
- - update the principal private residence ("PPR") relief; the relief is complicated and outdated and does not cater for modern living patterns.
- - abolish the main residence nil-rate band and replace it with an increase to the nil-rate band to £500,000 per person (i.e. £1m per married couple).The provisions are complicated and prejudice against people who do not have direct descendants.
- - abolish the 8% capital gains tax surcharge on residential property disposals so that capital gains are taxed at 20%." Genevieve Moore, partner.
- "The Chancellor could introduce new measures to prevent people from incorporating their property portfolios into companies." Genevieve Moore, partner.
- Frank Nash, partner: "The Chancellor should use the tax system to boost supply of affordable housing by introducing capital taxation reliefs to incentivise landowners and developers to assist local authorities meet their affordable housing targets."
- "The pension annual allowance could be reduced from £40,000 to £20,000. I believe he should scrap the pension annual allowance and lifetime allowance to encourage people to save for their retirement, and instead introduce a cap on the amount that can be drawn tax-free on retirement." Nimesh Shah, partner.
- VAT partner Alan Pearce: "The Chancellor should re-introduce postponed accounting for import VAT. This would allow business to off-set import VAT via their quarterly VAT returns rather than have to pay it at the point of importation and claim it back up to three months later. This would be a significant administrative easement and assist cash flow for UK businesses importing goods. Apart from the one-off cash flow hit, it should not affect government revenues.
- This would allow the UK to compete on an equal footing with other EU countries, notably the Netherlands (and now France who adopted the treatment from 1 October this year). Those countries that operate a postponed accounting regime often promote it as an incentive to do business there rather than the UK. This will become more important in the run up to Brexit and beyond."
- "The Chancellor should fix the Annual Investment Allowance at £500,000 and keep it fixed for five years to encourage businesses to spend and invest in capital projects." Genevieve Moore, partner.
Could this be the last Autumn Statement?
- "Any changes to non-domicile legislation should be postponed until the full effect of Brexit is understood. The non-domicile taxation regime has been a cornerstone of the UK’s tax legislation for decades and Britain’s attractiveness as an international centre. There is a compelling argument to refresh and modernise the regime, but the timing of doing this now does not seem appropriate." Nimesh Shah, partner.
- "The Chancellor has been considerably less vocal than his predecessor in the weeks running up to the Autumn Statement which could hint to a move to a more “quiet” announcement. Traditionally the Autumn Statement was used to provide a status update and set the scene for March’s Budget. George Osborne’s time as Chancellor brought more attention to it by using it to introduce new measures as well." Nimesh Shah, partner.
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For further press comment, please contact David Barzilay on 0207 544 8980 or Julian Menendez on 0207 544 8831.