The Chancellor of the Exchequer, Philip Hammond, has presented his first and last Spring Budget, setting out the government's tax, spending and borrowing plans as Britain prepares to invoke Article 50 to leave the EU.
In fact, the UK's departure from the EU was barely mentioned in the Chancellor's speech. The tax measures announced were low-key, perhaps reflecting a desire for stability in the face of uncertainty generated by Brexit, the need for a period of calm following some significant tax changes for businesses (including the forthcoming reform of the corporate interest and corporate loss regimes) and the fact that this is the first of two 2017 Budgets. The Chancellor continued to focus on closing the tax gap by targeting tax avoidance and evasion, and sought to raise revenue by increasing taxes for the self-employed. But there was also good news for the oil and gas and financial services sector. New tax measures announced included:
- an increase in the rate of class 4 NICs for the self-employed;
- consultation on the options to provide support for the transfer of late-life oil and gas assets, including allowing the transfer of tax history between buyers and sellers;
- an exemption from withholding tax for interest on debt traded on a Multilateral Trading Facility and a proposal for further administrative simplifications to the Double Tax Treaty Passport scheme;
- a number of tax avoidance measures and consultations, including the removal of the ability for businesses to convert capital losses into trading losses and consideration of HMRC's risk profiling for large businesses; and
- announcement of the rates to apply to the soft drinks industry levy.
The Chancellor's restraint in announcing new tax measures was likely also to have been influenced by the fact that going forward the Autumn Budget will be the major fiscal event of the year, with a Spring Statement simply providing a response to the Office of Budget Responsibility's Spring forecast.
Further detail on many of the measures will be available on 20 March 2017, when Finance Bill 2017 will be published and a number of the consultations mentioned in today's Budget will be launched.
The above measures, along with other key changes, are dealt with in our full briefing which can be found here.
A link to the government's Spring Budget 2017 website and full documentation can be found here.