Fiona Graham, Chief Advocacy Officer at Family Business UK responding to the Spring Budget said:
“With challenges facing them on multiple fronts, the family business community has been waiting on tenterhooks about what support the Chancellor would offer to help kickstart the economy.
“While there were incremental improvements on full expensing and VAT thresholds, sadly today’s announcement lacked the strong long-term vision for family firms to help them grow and provide more opportunities within the communities in which they operate. With the recent appointment of a new SME Council by the Government, we hope to see continued engagement with the family business community and more policies for long term support in due course.
“On pensions the Chancellor mentioned moving ahead with the Mansion House Reforms.
“In the election year it’s essential that some of existing reforms around defined benefit pension scheme surplus sharing and consolidation keep moving ahead, and don’t come to a halt because of the election.”
Read the 2024 FBUK Budget submission
You can find the full Spring Budget, and accompanying documents, here.
Beyond the Headlines
There were updates to existing policies within the accompanying documents which will be of interest to many family firms, including:
- Further details on six Investment Zones in Greater Manchester, Liverpool City Region, North East of England, South Yorkshire, West Midlands and Tees. Find out more here.
- Levelling up funding and UK Community Renewal Fund updates. Find out more here.
- The Government’s response to changes around Agricultural Property Relief (APR) where land is being put to environmental uses. FBUK has engaged with HM Treasury and HMRC on this issue, and the need to update legislation to ensure family landowners are not penalised for tackling part in environmental schemes, as promoted by other parts of Government policy. You can find the response to the consultation here.
- The Chancellor also announced the Government’s intention to regulate the provision of Environmental, Social and Governance (ESG) rating providers. More information here.
- HM Treasury and DLUHC published their response to a consultation on Business Rates Avoidance and Evasion
Summary of Announcements
Tax
- 2p cut to employee National Insurance, from ten percent to eight percent.
- Self-employed National Insurance will be cut from eight percent to six percent.
- The non-domiciled tax status will be scrapped and replaced with a residency-based system from April 2025, raising £2.7bn in tax revenue a year by 2028/29.
- Fuel duty 5p cut will be maintained for a further 12 months.
- Alcohol duty freeze extended until 1 February 2025. Abolish the furnished holiday lettings regime.
- Abolish stamp duty relief on the purchase of multiple dwellings in one transaction.
- Reduce the higher 28 percent rate of Capital Gains Tax on property to 24 percent.
- Fuel duty 5p cut will be maintained for a further 12 months.
Business
- Planned legislation for full expensing to apply to leased assets.
- From April 1, increasing the VAT registration threshold from £85,000 to £90,000.
- £200m of funding to extend the Recovery Loan Scheme as it transitions to the Growth Guarantee Scheme.
- New powers for The Pensions Regulator and the Financial Conduct Authority to ensure better value from defined contribution (DC) pension schemes.
- Introducing new requirements for DC and local government pension funds to disclose publicly their level of international and UK equity investment.
- Introduce the British ISA with an additional £5000 tax free allowance for investments in UK equity.
- £270m for advanced manufacturing, to be spent on innovative automotive and aerospace R&D projects.
- Up to £120m more will be allocated to the Green Industries Growth Accelerator to build supply chains for new technology such as offshore wind and carbon capture.
- Extend the energy profit levy, the “Windfall Tax”, to 2029 to raise an additional £1.5bn.
- Abolish the energy profit levy if the energy market price falls back to a historic norm for a sustained period.
END.
