Business and finance experts in Cumbria have heralded Chancellor, Jeremy Hunt ‘disappointing’ and ‘unsurprising’.
Becky Bowness (pictured), Armstrong Watson’s Head of Tax, said: “Unsurprisingly, given an impending election, there was a lot of political bluster and not a lot of content in this budget. We already knew the headline grabber – a 2% cut to National Insurance Contributions for employees and the self-employed – but that doesn’t help employers, who will be faced with the increase to National Minimum Wage in April, and it also does little for fiscal drag given no change to income tax thresholds.
“While we didn’t expect anything for corporates, with full expensing and changes to R&D schemes announced in the Autumn, nothing was announced on business rates, which is fundamentally a huge cost to any business, and we had hoped for more support for family and owner-managed businesses. The 12-month freeze on alcohol duty will be welcomed by those in hospitality and also the extension of the fuel duty freeze for many businesses.
“While the increase of £5,000 to the VAT threshold is welcomed it falls short of the hoped increase to £100,000 particularly given the seven-year freeze and recent inflation.
“The Government is attempting to reduce UK debt so the Chancellor’s options to provide fundamental tax reductions or support were limited – but that doesn’t help the businesses that are crying out for help.”
Suzanne , Managing Director of Cumbria Chamber of Commerce said: “The Chancellor’s Spring Budget today was disappointing, but not surprisingly so, with little substantive support for businesses here in Cumbria. As ever, the devil is in the detail and it will be interesting to review the published documents, which always contain more information than the speech. But Cumbria Chamber’s initial response is as follows.
“Chambers have been pushing for action on the VAT registration threshold and the £5k increase in the threshold to £90k turnover is a positive move. However it does not go far enough and will do little to encourage more businesses to grow significantly as they manage activity to remain under the VAT threshold.
“We’ve also been pushing for the reintroduction of an internationally competitive scheme for tax free shopping for visitors. This would have a significant positive impact on the visitor economy, and on producers feeding into it. So it was disappointing that there was no mention of this, or moves towards it.
“Shortage of staff is one of the biggest issues facing businesses in the county, and mentioned by most in discussion. So it was hugely disappointing to see so little to address this in the Budget.
“While the measures on Child Benefit and National Insurance aim to bring more people into the workforce more of the time, this does not do enough to address the scale of the issue.
“In relation to the childcare measures previously announced, and commitment to the rate of funding announced today, while this is welcome, a key issue remains how the additional places can be staffed. Chambers, working together through BCC, have been pushing for a number of measures.
“Chambers have been pushing for longer-term commitment to Local Skills Improvement Plan funding, which is having a positive impact here in Cumbria and nationally.
“Alongside consumers, the county’s pubs and other hospitality venues will welcome freezing of this duty.
“Similarly the continued freeze on fuel duty will be welcomed by both businesses and consumers, who were facing a significant rise.
“While there were announcements around some specific sectors such as aerospace and tech, this misses the majority of businesses. A relatively small commitment through a grant scheme such as the Regional Growth Fund, which ran nationally some years ago, would have a real impact on the growth and productivity of a wide range of businesses – as demonstrated by the impact of smaller schemes we’ve been running locally.”
