Summer Budget 2015 – Landlords Reactions

Reply to the comment left by “KATHY MILLER” at “20/09/2015 – 20:15“:

Just read your recent postings – Great work Kathy!

very informative & just when i though I was up to date with the spread of debate

Thank you!

Reply to the comment left by “KATHY MILLER” at “20/09/2015 – 20:15“:

Just read your recent postings – Great work Kathy!

Very informative & just when I thought I was up to date with the spread of debate

Thank you!

t the same time, there are now more than 1.2 million people working part time because they could not find full-time work. That is 200,000 more people than when the Conservative party took office in 2010. John Philpott, director of the Jobs Economist, has raised concerns that the new national minimum wage will mean that employers could stop offering full-time permanent contracts to avoid paying the steep rise in the national living wage for the over-25s, which comes into force next April. He has stated:

What happens to these people they would never get a mortgage

Mr Gauke: Clause 7 will cut the rate of corporation tax to 19% in 2017 and 18% in 2020. Let me begin by giving some background to the measure. The Government have made it clear that we want a business tax regime that is competitive and fair, and since 2010 we have made clear strides towards that goal. The main rate of corporation tax was 28% in 2010. We had the 20th-lowest main rate among the EU27 countries, as other countries cut rates further and faster than the UK. To combat that, we have cut the rate by almost a third, to 20%, to make the UK more competitive and to support growth and investment. That is one of the biggest boosts that British business has ever seen. [Hon. Members: “Hear, hear!”] In addition, the small profits rate was also cut to 20% in the previous Parliament, and the two rates were merged to simplify the tax regime. Overall, the cuts delivered in the previous Parliament will save businesses £10 billion a year from 2016-17.

We believe that it is essential that the Government consider the whole system of tax reliefs available to businesses and how we can make it more simple, efficient and fair for businesses and for society. Businesses need certainty to encourage long-term investment and good business planning. Although they should pay their fair share of taxes, we should be looking at how we can provide certainty.

The above should also apply to the Sole trader in BTL

In 2014-15, corporation tax made up 7% of the total tax take in the UK. We need to be clear that cutting corporation tax amounts to a transfer to the largest businesses that disproportionately benefits them. We are concerned that a more effective policy measure, such as the one suggested at the election, could have been used to help all businesses, rather than just the largest companies. We question the reasoning behind the Government’s policy decision. It appears that corporation tax has been used because it is relatively easy to alter. I am sure the Government recognise that a substantial amount of money is going to businesses. Will the Minister outline how the Government intend to pay for the rate cut, which in 2020-21 will cost £2.5 billion? We have not seen a breakdown of exactly how that will be paid.

I want to talk about the balance of the Government’s tax cuts, including changes to inheritance tax. Those changes will cost £24.6 billion over the Parliament, and they will be financed by five main sources, according to the Office for Budget Responsibility. Tax increases will raise £47.2 billion over the Parliament; we have talked about things such as insurance premium tax. Welfare cuts, including cuts to tax credit and many freezes, will raise nearly £35 billion. Other spending decisions will cut £8.1 billion. Cuts to departmental spending and to the BBC have been proposed. Various tax and spending decisions have indirect effects that will raise a further £14.2 billion.

The Budget decisions, interestingly, imply £3.5 billion of extra borrowing over the Parliament, on top of the £14.6 billion increase indicated by the OBR pre-measures forecast. Inheritance tax raised an estimated £3.8 billion in 2014-15, but house price inflation had been expected to drive the tax take up to £6.4 billion by 2019-20. Instead of the Exchequer receiving more revenue from inheritance tax, however, the policy is expected to cost it £940 million a year by 2020-21, when the additional family home allowance—like the existing allowance, it will be transferable between spouses—reaches £175,000 per person.

When they talk about borrowing, Conservative Members should bear in mind that if the Government had kept the existing allowance, they would have more than halved expected additional borrowing over the lifetime of the Parliament. In contrast, their position appears to mean more borrowing, when one of the Government’s specified aims is to do the opposite. It seems strange that in the debates we have had so far the Conservative party seems to be convinced that it is okay to increase taxes such as insurance premium tax and to make increases that hit very large numbers of people the main way to raise finances, while implementing changes to inheritance tax that will cost the Exchequer considerable sums of money.

Surely, keeping inheritance tax as it was would be better than increasing the insurance premium tax and making hefty welfare cuts. Those are the decisions that are weighed against each other. The Government are cutting a tax for the wealthier families in the country, while cutting tax credits for millions of those who are in need. That is what we are going to see over the coming years. We could say that this is a rather warped interpretation of Robin Hood: taking money from the poorest to pay for a tax cut for the richest.

Written evidence reported to the House

FB 01 Association of Taxation Technicians

FB 02 Mr Mark Anderson

FB 03 Simon Sheppard

FB 04 John McKay

FB 05 Kathy Miller and her tenants

FB 06 Dr Rosalind Beck

FB 07 Neil Allen

FB 08 Christian Aid

FB 09 Gary Bartram

FB 10 Neil Patterson

FB 11 Jonathan Bruneau

FB 12 Nicholas Rollin

FB 13 Scottish Land & Estates

FB 14 Low Incomes Tax Reform Group

FB 15 Clive Blackman

FB 16 Mr Alan Wong

FB 17 Rev. Dr. Peter Thomas Sanlon & Mrs. Susanna Sanlon

FB 18 Chartered Institute of Taxation

FB 19 Mrs Angela Bryant

FB 20 Nick Mansfield

FB 21 Rich Mockett

FB 22 Paul Frodsham

FB 23 Paul Obernay, Xarifa Holdings Ltd

FB 24 Graham Chilvers

Column number: 72
FB 25 Jan Geertsema

FB 26 Maureen Treadwell

FB 27 Christina Windley

FB 28 T.P. Properties

FB 29 Phil Harmer

FB 30 Melvyn Alan Lees-Smith

FB 31 Zvi Abenson

FB 32 Ray Williamson

FB 33 Jason McClean

FB 34 Bluewater Properties

FB 35 Joyce Griffiths

FB 36 W.T. Morgan

FB 37 Peter Walsh

FB 38 Simon Shinerock

FB 39 Association of Taxation Technicians supplementary

FB 40 Chartered Institute of Taxation

FB 41 Kelley Knox

FB 42 Charles Dowding

FB 43 Dr. Simon Crutchley

FB 44 Malcolm Smith

FB 45 Dr Araripe Garboggini

FB 46 Michael Fickling

FB 47 Andy Large

FB 48 John McKay

FB 49 Richard Hayward

FB 50 Mark Brown

FB 51 Rachel Baker

Reply to the comment left by “KATHY MILLER” at “21/09/2015 – 07:43“:

Kathy, where did you get this info from?

I take it you have also presented evidence…as you name is on the list.

Reply to the comment left by “Saeef Khan” at “21/09/2015 – 07:51“:

http://www.publications.parliament.uk/pa/cm201516/cmpublic/finance/150917/pm/150917s01.htm

Yes I submitted

Reply to the comment left by “KATHY MILLER” at “21/09/2015 – 09:56“:

I will be very interested to read the transcript of discussions around clause 24 when they get around to it… I just cannot see how they will justify it under scutiny.