Philip Hammond delivered his first (and last) Autumn Statement as Chancellor this week.
This at-a-glance guide contains all the key announcements and updates relevant to the accounting profession.
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Business and finance journalist
The OBR report quotes the £122bn additional borrowing. Am I right that this will reduce if direct and/or indirect taxation is increased. This is not mentioned. Is this because taxation is a March/Budget issue, not Autumn statement?
We can’t really comment on the OBR forecasts and why they change.
Taxation issues are not confined to March Budget.
We have all been waiting for Wally Hammond's budget, sorry Philip Hammond's Budget, I quite like it, financially hes boxed, (national debt) but unlike Gordon brown and George Osborne, he has not made tax changes for the sake of it. Its a simple budget.
Now as for the National debt, it is expected to rise to 2 Trillion, and the worst is yet to come, so the question is.. when does national debt become unsustainable, probably not yet or for the foreseeable future, some how this country keeps on going. However the NHS and pensions could be on the next rich area for cuts shortlist.
Phillip has bust apart George Osborne's promises for a 12019 /2020 surplus, it was never going to happen.
The office of Budget responsibility has advised the UK will have to pay 58.7 billion due to the impact of brexit. Now there is talk of 30,000 civil servants and one of the big 4 also working for the Government on Brexit, factor in Wolfgang Schäuble says that some commitments will still need to be paid for more than a decade after final split, say 2030 and the total brexit bill will be 100 billion +, bearing in mind the UK contributes 19 billion a year to the EU, meaning ....we might have well have stayed in, however if our economy goes down the pan big time, thats probably the best time to join the EU, you get grants for everything.
23 Billion pounds for infrastructure, its never mentioned what type of infrastructure or where but there you go, and so do I ....
The Report by Rebecca Cave on the Flat Rate Scheme for low cost traders says:
This emphasis on ‘goods’ will discriminate against businesses who incur VAT on services such as: rent, software licences, IT support, digital journals, sub-contractors, telecoms etc. In VAT terms a service is anything which is intangible, or where the cost relates to a tangible asset it is the temporary use of that asset – such as hiring.
The actual report from the Chancellor states:
What is a limited cost trader?
A limited cost trader will be defined as one whose VAT inclusive expenditure on goods is either:
less than 2% of their VAT inclusive turnover in a prescribed accounting period
greater than 2% of their VAT inclusive turnover but less than £1000 per annum if the prescribed accounting
period is one year (if it is not one year, the figure is the relevant proportion of £1000)
Goods, for the purposes of this measure, must be used exclusively for the purpose of the business but exclude the following items:
Food or drink for consumption by the flat rate business or its employees
Vehicles, vehicle parts and fuel (except where the business is one that carries out transport services for example a taxi business and uses its own or a leased vehicle to carry out those services)
These exclusions are part of the test to prevent traders buying either low value everyday items or one off purchases in order to inflate their costs beyond 2%.
Why does Rebecca Cave assume the new legislation discriminates against business who incur Vat on such items as Rent and Telecoms etc?
My reading of the new legislation is that ‘for the purpose of this new measure’ Goods are all Costs used exclusively for the purpose of the business (including services). Like the Taxi driver who leases his vehicle.