Budget 2016: Business as usual?

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This year’s Budget arrives one day after the Ides of March, a date synonymous with the assassination of Julius Caesar in 44 BC. While it is likely that George Osborne will ‘hail’ the contribution of British industry, there are those who feel that the Chancellor is preparing to stick a knife the back of business in the form of additional tax and legislation.

With the economy £18bn smaller than the Office for Budget Responsibility expected following growth of 2.8% rather than the 3.8% forecast for 2015, Osborne indicated yesterday that the UK must “act now to make sure we don't pay later”.

While cuts amounting to 50p in every £100 of spending by the end of the decade may help the Chancellor to meet his target of running a budget surplus by 2020, it is expected that Osborne will look to business to raise some the funds needed.

However, some commentators feel that with the European referendum looming the pro-EU Chancellor and his Prime Minister are fighting for their political lives. To win the referendum Osborne must build up business confidence to project the message that the UK has ‘something to lose’ by leaving the EU. Introducing measures that may stifle business and entrepreneurship might be seen as counterproductive to this.

Ahead of George Osborne’s appearance at the dispatch box, AccountingWEB takes a look at what UK businesses would like – and what they’re likely to get – on Wednesday.

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Tom Herbert
Business Editor
AccountingWEB
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14th Mar 2016 18:04

Is there any point ?

When the UK overwhelmingly votes in June to leave the EU all of his calculations will be consigned to the rubbish bin.  By happy coincidence his £18 billion shortfall is about what we pay to the EU every year.  

Thanks (3)
14th Mar 2016 18:23

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@The tired Accountant, this is an accounting forum. 

Sales VAT £18

Purchase VAT £10 

The net payment is..........................?

Clue: Its not £18.

 

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14th Mar 2016 19:15

Net benefit

ireallyshouldknowthisbut wrote:

@The tired Accountant, this is an accounting forum. 

Sales VAT £18

Purchase VAT £10 

The net payment is..........................?

Clue: Its not £18.

 

 

I am well aware it's an accounting forum, I'm also well aware of the NET cost of EU membership to the UK, which is a MINIMUM of £18 billion a year. We are the 2nd largest net contributor to the EU.  Also leaving the EU will drastically improve our balance of payments, our territorial waters will not be open to Spanish trawlers, our businesses will be free to trade with the world unshackled from EU petty bureaucracy. We will also be able to dump the pointless "green taxes" imposed by corrupt Brussels mandarins. 

As an added bonus "Dave" will be completely discredited and his departure from number 10 hastened to allow Prime Minister Boris to take over and George can be retired (or put in charge of something harmless like Minister for Floods) and a decent Chancellor found to replace him. 

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15th Mar 2016 09:25

Fact check

Not sure where you are getting your figures from but I think you are talking what is technically known as "balls" to quote £18 billion.  Sounds like its come from tabloid newspapers.

Estimates are quite wide spread as they depend on how you define benefits of membership, but the treasury quoted around £8.5bn net contribution from National Statistics sources for just the government and local authorities. This net contribution excludes where a lot of the money goes, ie this excludes income of private individuals and companies, such as subsidies to farmers or soft loans and grants to business, which brings the net cost to the UK down a lot further. Still a lot of money, but at least I haven't made it up.  The data is in the budget documents each year and should be fairly robust, albeit forecasts will vary depending on the performance of the economy. 

This short document quite neutral if you would like to actually find out about this area.

www.parliament.uk/briefing-papers/SN06091.pdf

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14th Mar 2016 23:00

Official figures ?

ireallyshouldknowthisbut wrote:

Not sure where you are getting your figures from but I think you are talking what is technically known as "balls" to quote £18 billion.  Sounds like its come from tabloid newspapers.

 

 

Official figures state that £55 million a day – the equivalent of about £20 billion a year – is only one part of the overall cost of the EU. It is also necessary to factor in the likes of regulation costs, lost jobs and the Common Agricultural Policy.

EU membership costs UK billions of pounds and large numbers of lost jobs thanks to unnecessary and excessive red tape, substantial membership and aid contributions, inflated consumer prices and other associated costs.

The Common Fisheries Policy has cost British coastal communities 115,000 jobs.

Less than 15% of Britain’s GDP represents trade with the EU yet Brussels regulations afflict 100% of our economy (the 5th largest in the world)

-Over 70% of the UK’s GDP is generated within the UK, but still subject to EU law.

-In 2006 it was estimated that EU over-regulation costs 600bn Euros across the EU each year.

-In 2010, Open Europe estimated EU regulation had cost Britain £124 billion since 1998.

 

As stated, a vote for "out" will render Osbourne's calculations obsolete, and current polls suggest a massive majority for the "out" campaign.  

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15th Mar 2016 10:36

Link?

The tired accountant wrote:
Official figures state that £55 million a day.
Provide a link to these "official" figures that actually backs up your statements and people might take you seriously.

The last time someone made such a claim, the link they eventually provided entirely contradicted their statements.

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14th Mar 2016 22:26

Nine George Osbornes... thanks, that'll give me nightmares tonight

Thanks (1)
By Ruddles
15th Mar 2016 08:16

Worrying

I'm hearing some very familiar noises

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By Lship
15th Mar 2016 16:51

@Stepurhan

https://fullfact.org/economy/our-eu-membership-fee-55-million/

 

I'm guessing this is where the £55m figure comes from, but as it says it doesn't take into account the money that comes back in rebates etc,

 

Figure is probably closer to £19m by my reckoning

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