Dressing up the Budget
When it comes to Budget seminars, there are few more adventurous than one of the region's leading accountants and business advisers, PKF East Anglia. The firm hosted a series of events for businesses, with staff from their Ipswich, Norwich and Great Yarmouth offices bringing the Budget to life.
The Ipswich team chose 1982 as their theme, with tax specialists donning various disguises, at the same time highlighting PKF's strong links with the Falkland Islands, which are currently commemorating the 25th anniversary of the Falklands War.
Tax Partner Peter Harrup explained: "We always like to make our seminars interesting and the 100-strong audience in Ipswich certainly enjoyed our approach. However, there was a serious theme, which was to inform the business community about how the Budget will affect them."
A further 100 business people and clients attended the Norfolk events, where they were informed about important business issues in the Budget, which include:
- Changes to the corporate tax rate - which is increasing for small businesses but going down for large corporates
- Capital allowances for plant and machinery reducing from 25% to 20%
- Industrial building allowances to be phased out
- Petrol and diesel up two pence a litre, although the VAT paid for by a company for private mileage has gone down
- Plus firms will be liable for subcontractors who use managed service companies who do not pay their tax and NIC
Michael Muskett, PKF Regional Partner in Charge added: "We feel the Chancellor 'chickened out' and left the issue of UK business competitiveness for his successor to address. Cutting corporation tax in 2008 may persuade corporates to delay taking a decision to move out but Mr Brown has failed to send a clear message that Britain is the place to do business."
He added that Britain currently has the seventh highest tax rate and the least business-friendly system in the EU. The Chancellor's procrastination is likely to see the country slip further down the European competitiveness league table.
"It was welcome relief that, in his speech, he didn't succumb to pressure to restrict tax relief on interest for business but while the UK's tax regime remains so complex, our competitive edge is draining away. The danger is that multinational business will look to countries with more business-friendly tax regimes, which will have a knock on effect on manufacturers, smaller companies and jobs in the UK."