A treading water Budget but the NI change opens up a big potential money spinner
March 08, 2017
This was a comfortably treading water Budget - keeping things ticking along as we move to a single Autumn Budget. A number of reviews and consultations were announced, suggesting bigger news will come in the Autumn. The increase in National Insurance was smaller than many expected, but the significance of this move should not be underestimated. It is very clear the Chancellor sees differences between the two regimes as anomalies to be ironed out. This has opened up a big potential money spinner. The self-imposed tax lock is tying the Government's hands, as the Chancellor clearly wants to raise money but is committed not to do so from the main taxes of income tax, NIC and VAT. That means other areas of the economy will continue to see increases and tightening. There clearly wasn't scope for a give-away Budget but it would be good to see more attention given to entrepreneurs and wealth creators. It's great to see the focus on long term planning and consultation. But there was missed opportunity to provide a vision on how tax can support the industrial strategy and post Brexit Britain more generally. Nor was there anything to simplify tax. The necessary reforms require considered consultation, and now is the time to plant seeds for change.