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What's The Future Of Our Taxes?

Do we need to batten down the hatches?

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POSTED BY ROGER EDDOWES ON 29/07/2019 @ 8:00AM

When we get a new Prime Minister and Chancellor of the Exchequer, we always seem to have a number of changes to complicate our tax calculations ...

It seems that the new Conservative Government is looking to copy the Nigel Lawson era of cutting tax to encourage enterprise post-Brexit!

It seems that the new Conservative Government is looking to copy the Nigel Lawson era of cutting tax to encourage enterprise post-Brexit!

copyright: prime minister's office, number 10 downing street

Boris Johnson's tax pledges are well publicised with an increase in the higher rate threshold from £50,000 to £80,000. This would give a £6,000 tax saving, but Boris went onto say it would mean that National Insurance contributions will need to increase.

"It has to be paid for somehow!"

Could this hit the Scottish taxpayer though? The Scottish Government set the rates for Scottish taxpayers (and will they follow suit?) whereas Westminster set the National Insurance contributions.

The Government has already stated that corporation tax will reduce from 19% to 17% next April at the cost of £14bn. Will it go further as Jeremy Hunt was pledging? Coupled with the proposed income tax cut costing £10bn, £24bn needs to be found from somewhere. Will it go ahead?

It seems that the new Conservative Government is looking to copy the Nigel Lawson era of cutting tax to encourage enterprise post-Brexit!

In contrast though, and not surprisingly, the Labour manifesto back in 2017 pledged to raise more tax by charging income tax at 45 per cent on income over £80,000 and re-introducing a 50 per cent tax rate for income exceeding £123,000. They also pledged to raise an additional £19.4bn from corporation tax.

Boris has also suggested homeowners could receive a tax break with the Stamp Duty Land Tax thresholds being raised as well as lowering the top rate from 12% to just 7%, again the opposite of what Labour is proposing.

As we live through these uncertain times, it will be interesting to see whether it is the right or left that catches the majority. Or perhaps it is not that clear cut and Nigel Farage has indeed changed politics for good?

With a lot of people enjoying their summer holidays, it's a bit like the calm before the storm, so keep calm and carry on! Batten down the hatches and prepare.

The US will send us some disruptive weather this autumn with the remnants of the odd hurricane. It's also the equinox on 23rd September and that can always bring stormy weather. I will definitely be having my boat safely stored on dry land!

"Would you like to know more?"

If you'd like to find out more of my thoughts around the new tax proposals from PM Boris and his new Cabinet, do give me a call on 01908 774320 or click here to ping me an email and let's see how I can help you.

Until next time ...

ROGER EDDOWES
Business Godparent


PS:

If you're looking to work with a leading firm of accountants, then why not visit our website which you can find at www.essendonaccounts.co.uk and let's see how we can help you!


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More about Roger Eddowes ...

Roger trained at Edward Thomas Peirson & Sons in Market Harborough before working at Hartwell & Co, followed by Chancery, as a partner. He started Essendon Accounts and Tax with Helen Beaumont in 2014 as a general practitioner with a hands-on approach.

Roger loves ‘getting his hands dirty’, working with emerging, small-to-medium and family businesses to ensure they receive the best possible accountancy advice. Roger utilises an extensive network of business contacts to leverage the best guidance and practical solutions.