What is Hammond planning for the Budget?

11 Downing Street
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Philip Fisher
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Philip Fisher attempts to predict what the Chancellor will say when he approaches the dispatch box a week on Monday. 

Writing about tax is generally an enjoyable pursuit. However, at periodic intervals editors will begin to hector you, demanding to know what the Chancellor of the Exchequer has planned for his next Budget.

I would wager that, as of this moment with under two weeks to go, Philip Hammond has little more idea of what he is planning than I do.

Given the current turmoil within the cabinet, it seems highly unlikely that anything very material will get said. That is my first confident prediction. The second is that this will not stop Hammond from wittering on about anything at all and making snide comments about the opposition for a full, painful hour.

Moving the annual announcement about the government's fiscal plans from an afternoon in spring to a lunchtime in the winter didn't ever really seem like a very good idea. This year, it could very easily be mistaken for a joke in rather bad taste.

Since nobody, not even Boris Johnson, has the faintest idea about how or for that matter whether the United Kingdom will exit Europe, let alone the impact this will have on Northern Ireland, the best economist in the world could not make any sage statements at this juncture. Therefore, a poor innocent accountant has no chance.

Hammond's speciality has always been to do as little as possible but bluster to give the impression that he is achieving far more. This time around, there's likely to be less substance even than his usual insubstantial offerings, but by way of compensation potentially record-breaking amounts of bluster.

In this situation, the obvious thing to do would have been to abandon the speech on Monday week and announce a return to spring Budgets. This would have meant that in April the Chancellor of the Exchequer, when he will have at least a little more knowledge about the ensuing year, could have made some positive statements that might have some value.

My predicting hat may be effective when it comes to second-guessing the nullity of the late October trip to the dispatch box. However, when I asked it to name the Chancellor next April, it suddenly became shy and hid in the back of a cupboard, along with the crystal ball that was supposed to be confirming the name of the Prime Minister on the same day.

So what is going to happen? With all that is going on and the current economic disasters over NHS funding (remember that bus) and universal credits which are becoming an ever-expanding millstone, it is hard to imagine that Hammond will have any money to give away. On the other hand, given that he and his Prime Minister are trying to save their jobs from members of their own party let alone the opposition, unpopular tax rises seem equally unlikely.

The best that we will probably get is yet another voluble attack on "tax avoidance", together with a series of airy-fairy promises that are predicated on some kind of European outcome that may never happen.

Having said all of that, I can't tell you how much I'm looking forward to turning on the TV at lunchtime on October 29th.

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By Matrix
20th Oct 2018 08:04

You failed to actually predict any measures in the article.

I just read that Hammond could change the employment allowance but retain for micro businesses.

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22nd Oct 2018 13:09

At least the budget will have more content than this article!

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22nd Oct 2018 13:58

I'm keeping a very close eye on any changes to workers in the private sector. If they introduce IR35 into the private sector, it will have huge repercussions for contractors and their accountants. Common sense says they won't do it, but since when has common sense prevailed.

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By Matrix
to Joe Alderson
22nd Oct 2018 14:44

It will have huge implications for the private sector but they have not realised they have less than 6 months to get it all set up, why they have not lobbied the government along with the contractors I have no idea. It may go ahead as the government thinks the public sector changes were a success.

But in some ways I would prefer this change as it is targeted at contractors over a change such as an increase in dividend tax which would affect all small business owners who have much more risk.

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23rd Oct 2018 09:46

You'll be having a late lunch, as the Budget speech isn't due to start until 3.30pm on 29 October!

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23rd Oct 2018 15:46

Given the recent improvement in public financesand the Brexit dividend we should be expecting some tax cuts.

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