So What's In The Red Box?
It's that time of the year again and we know it's not going to be pretty. Despite their best efforts the coalition couldn't stop the public borrowing figure for February coming in higher than expected, that coupled with new highs in the unemployment figures means that George Osborne is going to have to play straight down the middle rather than fast and loose.
Of course a lot of the financial measures for 2011-12 are already in place. The Autumn spending review has seen budgets slashed along with jobs across the public sector, this is now beginning to have an impact on the private sector as the trickle down effect of Government contracts is reduced to...well, a trickle. We also know that the Annual Investment Allowance for small businesses has been slashed, like all allowances it is a subsidy by another name but it's important because it does actually influence spending decisions among smaller businesses.
The most trumpeted change in VAT will have an impact on all of us who buy goods over the interweb, the loophole that allows goods under £18 to be sold in the UK from the Channel Islands could well be closed. This will have an impact on Amazon, Play.com etc but the upside is that it should protect jobs among smaller mainland based businesses.
Tax avoidance is one aspect of our lives that gets everybody excited and there are rumours that there will be a crackdown to recover some £1bn-a-year. There are also rumours that there will be a new series of measures designed to recover some of the £42bn a year tax that goes uncollected, something I have posted about in the past.
Oh and in keeping with the old Chancellor ploy of introducing a new high profile tax whilst removing an obscure tax that nobody knew was still on the books the super-rich will have to pay flight taxes on their private jets.
Although given the fact that we are saying goodbye to £1m each time a cruise missile is launched against that mad bloke with the moustache who lives in a tent it all seems rather trivial in one sense.
3 comments:
The private jet thing made me giggle. Public borrowing ahs to go up, I don't understand why anyone would think it would go down...slowing the oil tanker springs to mind, and given that the spending cuts aren't cuts borrowing was bound to keep increasing in the short term.
I hope you are right re uncollected tax etc....and of course the missile comment is even more trivial when put against the 120 million in DAILY debt interest.
"But they also believe borrowing figures will not be as high as previously anticipated - up to £10bn lower than the £158bn predicted in last June's emergency Budget."
http://www.bbc.co.uk/news/uk-politics-12824055
But then if you up the estimate you can then say it wasn't as high as expected :-)
Ah yes but the missile and the daily debt are paid out of different reserves.
Public borrowing should never go up in February that was why everybody was surprised.
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