Budget update

In March 2016, George Osborne, Chancellor of the Exchequer, delivered his eighth Budget.

Alongside the headline announcement of a new sugar tax for soft drinks, Osborne increased ISA saving limits, introduced a new ‘Lifetime ISA’ for under-40s, and increased the income tax allowance. Hauliers and households alike will also welcome freezes on fuel and beer duty.

Lower-than-expected productivity and growth forecasts from the Office of Budget Responsibility (OBR) prompted the Chancellor to introduce a number of measures to support business growth. These included reducing the rate of Corporation Tax to 17 per cent in 2020, and raising the threshold for small business rate relief to a maximum of £15,000 (£51,000 for the higher rate).

Energy-related measures included the scrapping of the Carbon Reduction Commitment in 2019, which currently requires large businesses to buy allowances for every tonne of carbon they emit. The Climate Change Levy will be increased to cover lost revenue. Osborne also announced that the Government would consult on a simplified energy and carbon reporting framework for businesses later this year.

As well as these tax and reporting changes, the Chancellor introduced new Government funding for a range of energy projects, including offshore wind, energy storage, ‘demand side response’, and advanced nuclear manufacturing.

During the Budget, Osborne reiterated the Government’s message that Britain would be better off inside a reformed European Union, drawing attention to the OBR’s comment that “a vote to leave […] could usher in an extended period of uncertainty regarding the precise terms of the UK’s future relationship with the EU”.

For more information about the 2016 budget click here 

 

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