Autumn Budget predictions

Chancellor Philip Hammond's first Autumn Budget is less than 2 weeks away.

Against a backdrop of increasing inflation, rising interest rates and uncertainty surrounding the UK's departure for the EU, we take a look at what might be in the chancellor's red briefcase on 22 November 2017.

Rates and allowances for 2018/19

Mr Hammond's reasoning behind the move to the Autumn Budget is to give parliament longer to scrutinise measures before they are implemented, so we can expect to see rates and allowances for the major taxes for 2018/19 in 2 weeks' time.

The Conservatives promised to raise the personal allowance to £12,500 and the higher rate band to £50,000 by 2020 in their 2017 manifesto. It's likely the 2018/19 rates will edge towards these figures.

Likewise, the government has pledged to reduce corporation tax to 17% by 2020. It's currently 19% so there's a possibility of a slightly lower rate for the next tax year.

In theory, knowing the tax changes in advance will give business and individuals more time to plan and adjust.

However, the chancellor has warned that he may announce additional measures in the spring if there are any unexpected changes in the economy.

Business rates

Business rates are set to increase by 3.9% in April 2018. Unsurprisingly this hasn't gone down well with the business community.

The manufacturer's organisation EEF wants the government to cap increases at 2%, while the British Retail Consortium (BRC) has gone a step further by calling for a freeze on the business rates.

Helen Dickinson OBE, chief executive of the BRC, said:

"In his Budget the chancellor needs to get a grip on the matter and rule out a rise in business rates to help save shops, protect jobs, and preserve high streets."

Stamp duty land tax

The chancellor is under pressure to cut stamp duty to help first-time buyers get on the first rung of the property ladder.

A stamp duty holiday for first-time buyers would benefit anyone who buys a property in England or Northern Ireland for more than £125,000.

Charles McDowell, commercial director of mortgages at Aldermore bank, said:

"Some have suggested that the government plans to announce cutting stamp duty for first-time buyers in the Autumn Budget, a step we would welcome.
"As it stands, first-time buyers are systematically let down by an overly complex, opaque and costly system."

Simplified ISAs

Could we see a simplified ISA system? The Association of Accounting Technicians (AAT) argues that the ISA landscape is becoming "increasingly confusing".

The association suggests that no new ISAs should be introduced and the government should consider reducing the number of ISA products available.

Apprenticeship levy reform

Although it was only introduced in April 2017, there are already calls to reform the apprenticeship levy.

Research by the British Chambers of Commerce (BCC) found that almost a quarter (23%) of businesses paying the apprenticeship levy has no understanding of how it works.

Jane Gratton, head of business environment and skills at the BCC, said:

"Firms need greater flexibility on how they can use their levy payment and a system that is fully operational as quickly as possible, is simple and efficient, and enables them to access good quality training."

This sentiment was echoed by the Institute of Directors, who want employers to be able to use their contribution for more types of training and to train self-employed contractors.

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