Budget response: ACCA welcomes sensible, steady measures to support growth

In response to today’s Budget, ACCA Head of Taxation Chas Roy-Chowdhury says,

The housing market

Abolishing Stamp Duty for first time buyers up to £300k is a very welcome and bold move. Ensuring it is stepped up to £500k also means it can provide meaningful benefits for first time buyers in the capital and other major cities.

One option we have not seen is of exempting properties taken in part exchange by builders from Stamp Duty. If they were exempt from Stamp Duty as temporary trading stock it would remove a disincentive for house-builders to redevelop existing stock and help stimulate supply. This would help get the housing market moving and help first time and buyers where the seller is unable to move.

Tax avoidance

We are pleased with the range of tax avoidance consultations which the Government has announced today. We will be working closely with the Government as well as OECD and EC to ensure that tax avoiders have no place left to hide.

We welcome the targeted, realistic and proportionate approach the Government has taken and this is exactly how we should ensure we stop the promotors and users of such schemes.

Income Tax Personal Allowances

We welcome the Government adhering to the manifesto pledge to increase the PA and the basic rate band up to £11,850 and £46,350 respectively from 2018. Individuals are suffering from a lack of earnings growth and relatively high inflation so this is welcome to them. But after the achievements of countering fiscal drag where, so many have been sucked in to the 40% rate of tax over the last few years, the Government should ensure that we do not let up on expanding personal allowances by at least the rate of inflation in the future.  

Business rates

The move to CPI from RPI for business rates revaluation is welcome, as well as reducing it to every 3 years. This is an important move towards a more accurate measure in line with global standards which provides greater certainty and stability for business.

VAT threshold

We welcome the decision to keep the VAT threshold. The current VAT threshold at £85,000 is set appropriately for UK small businesses with the imminent introduction of Making Tax Digital. Given the pressures of implementation as well as any possible commercial changes due to Brexit, such as the loss of the mini one stop shop (MOSS), any changes could prove to be too great a burden for SMEs.  

Productivity & skills

The Chancellor’s statement also included sound measures to invest in productivity and future skills. In particular the R&D tax credit and removal of benefit-in-kind tax on electric vehicles are good examples of how to use the tax system to encourage innovation and education.

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Notes to Editors

About ACCA

ACCA (the Association of Chartered Certified Accountants) is the global body for professional accountants, offering business-relevant, first-choice qualifications to people of application, ability and ambition around the world who seek a rewarding career in accountancy, finance and management.

ACCA supports its 198,000 members and 486,000 students in 180 countries, helping them to develop successful careers in accounting and business, with the skills required by employers. ACCA works through a network of 101 offices and centres and more than 7,291 Approved Employers worldwide, who provide high standards of employee learning and development. Through its public interest remit, ACCA promotes appropriate regulation of accounting and conducts relevant research to ensure accountancy continues to grow in reputation and influence.

Founded in 1904, ACCA has consistently held unique core values: opportunity, diversity, innovation, integrity and accountability. It believes that accountants bring value to economies in all stages of development and seek to develop capacity in the profession and encourage the adoption of global standards. ACCA’s core values are aligned to the needs of employers in all sectors and it ensures that through its range of qualifications, it prepares accountants for business. ACCA seeks to open up the profession to people of all backgrounds and remove artificial barriers, innovating its qualifications and delivery to meet the diverse needs of trainee professionals and their employers. More information is here: www.accaglobal.com