So the CCC (my acronym for the Cameron Clegg Coalition) have set out their budgetary stall. We knew what to expect and small business organisations seem pleased with the Queen's Speech. But the CCC have studiously avoided the awkward question of VAT.
Yes, the 1% rise in NI contributions has been blocked until April next year. When it does come into effect, the CCC believe the impact on employers will be reduced because the threshold will be raised. The Cleggs wanted the employee threshold to rise as well, but I think the Camerons got in the way.
If you're a small business looking to recruit new staff, then the NI moratorium may help you in your plans.
And it's good that the new government intends to invest in high-speed broadband. The internet is a lifeline for thousands of SMEs, so faster and more powerful broadband holds the prospect of new markets and increased turnover.
But VAT was conspicuous by its absence. According to
Accountancy Age, the UK has the lowest VAT rate in Europe and the narrowest scope, ie European countries have a higher rate which covers a much wider range of goods and services. As retailers have already been through the process of re-calibrating VAT once, say the analysts, George Osborne would find VAT increase a simple means of raising large sums of money.
Many of us were hoping for measures to tackle the big banks, but the CCC ducked the issue. The Financial Reform Bill merely gives financial regulation back to the Bank of England (BoE), rather than the three-way remit β the BoE, the Treasury and the Financial Services Authority β introduced by Labour. The Bill makes no mention of a tax on banks' profits, contrary to earlier reports.
Were there other measures β for example, Inheritance Tax or a Mansion Taxβ that you would have liked to see?
