With the forthcoming budget having been announced for March 6th and potentially being the last opportunity for the government to present before the next election, it’s likely to be a significant one to watch.
Of the election date, the Guardian comments that it may be sooner than later:
“Budgets must take place before the end of March, but are more commonly scheduled for the second or third week of the month.
The decision to hold it at the beginning of the month has prompted speculation that Sunak has not ruled out an early vote, despite currently abject poll ratings…
Under the current rules an election takes place 25 working days after parliament is dissolved.
A 2 May vote, a date that would coincide with local elections in England and Wales, would thus require dissolution by 28 March.”
Of an election date, the FT is more cautious, reporting how:
Downing Street insiders say Sunak is most likely to call an election in the autumn. “It will give more time for lower inflation, tax cuts and — hopefully — lower interest rates to feed through,”
Of an election date, we will have to see what happens!
Ok, to the headlines and one of the big ones has been the return of the scrapping of inheritance tax. You might recall that we first mentioned this in August, however the government did not include it in the autumn budget.
It’s therefore interesting to have seen it resurfacing!
This is actually a divisive policy because, in some way, it appears to favour the better off; that is, those who have the level of wealth to hit the threshold (generally, this is homeowners).
Interestingly, shortly after the headline surfaced, there were further headlines were mere speculation, with Sunak’s spokesperson saying:
“On inheritance tax more broadly, the vast majority of estates do not pay inheritance tax, and the tax is forecast to contribute almost £10bn a year by 2028-29 to help fund public services that millions of us rely on.”
So, with this being one to watch, what else could the spring budget bring? Here’s a summary of potential new policies:
- More help for first time buyers
- Income tax cut
- Changes to inheritance tax
- A raft of other tax cuts
- Changes to fuel duty before the expiry of a temporary 5p cut in the tax on petrol, diesel and other fuels
- Possibly scrapping IR35
- A rise in the threshold at which the 40p tax rate kicks in
- Increasing the VAT registration threshold from £85,000 to, say, £250,000
Of course, this is all mere speculation, and I will be keeping a close eye on how things pan out. It does appear that, however, the spring budget will focus largely on individuals with businesses having to wait until the autumn (provided an election has not taken place by then).
For property investors, the spring budget appears to be ‘safe’ however with 2024 being a big year for things like the rental reform bill and potentially a change in government there are definitely plenty of things to keep the eye on!
