George Osborne’s final pre-election budget will be delivered tomorrow (Wed 18 March) and the business world is looking towards one of the first firm indications of what the post-election landscape could look like.
So what do the experts think will happen? And just as importantly what do they want to hear come out of the chancellor’s mouth? Some of the biggest names in the field give their views.
Sarah Wood, co-founder and COO of video ad tech company Unruly, says she hopes the proposed “Google Tax” will “level the playing field” for SMEs.
“It’s hard enough for SMEs and start-ups to compete with the resources of tech giants as it is, without having to bear more than our fair share of the tax burden,” she said.
“In practice, though, the devil is in the detail. If there’s too much complexity or subjectivity involved in defining avoidance then any punitive levy will be difficult to identify and expensive to enforce.”
She is also looking forward to the much-anticipated tax breaks for innovation and investment. Along with many high-growth businesses, especially in the tech sector, this is the area in which Unruly will take particular interest.
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“Innovation is in our DNA. The R&D tax relief programme has encouraged us to continue breaking new ground with our video ad technology and we look to the Chancellor to expand the programme,” she said.
“We also back the CBI’s call to bring stability, certainty and simplicity into businesses by raising the Annual Investment Allowance (AIA) to £250,000 permanently.”
Pension reforms have been a feature of a few of Gorge Osborne’s budgets. This being the one that will stick in pensioners minds when placing their vote in May, tomorrow should be no exception.
Barnett Waddingham LLP head of corporate consulting Nick Griggs primarily wants the chancellor to take stock following the “torrent” of recent legislation. Any announcements should include an effort to “consider whether more can be done to cut red tape”.
Beyond this Griggs wants clarification on VAT exemptions for pensions, which are unclear following a recent EU court case, and a review on the future on auto-enrolment.
“The minimum contributions to automatic enrolment schemes are unlikely to provide a comfortable income in retirement,” he said. “We would welcome the government encouraging members to contribute more. However, businesses need a period of stability in the pensions rules and we would caution against increasing employers’ minimum contributions while businesses are still recovering from the recession.”
RED Driving School CEO Ian McIntosh has urged the chancellor to keep the country on course and “not lurch back into old habits such as boom and bust cycles”.
“Now is not the time to start huge spending programmes or giving huge tax cuts. That said, what business needs, particularly SME’s, is stability, confidence and reassurance with respect to the business environment,” he said.
“Investments are typically made with a relatively long term view and believing the economy is in a well-managed recovery is therefore key to investment and business growth.”
Startup Direct CEO James Pattison believes that fledgling business need “practical help on the ground” from the chancellor. This means “major investment in co-working spaces”.
“Give funding to operators who understand how to create low cost spaces and bring together the right technology, advisory support and discounted services to encourage rapid growth,” he said.
“The government is out of touch with the tech start up scene, but meaningful long term investment through private sector operators could help thousands of small businesses get off the ground.”
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