Commenting on measures announced in today’s Budget, Chris Morgan, Head of Tax Policy at KPMG in the UK, said: “The Chancellor said this would be a Conservative budget and one for working families. He is determined to encourage and reward hard work. He delivered on this promise with raising the personal tax allowance and higher rate threshold, allowing family homes of up to £1m to be passed on free of IHT, increasing free child care for working families and introducing a compulsory National Living Wage as of next year. To encourage enterprise and job creation he will also reduce corporation tax to 18% by 2020, he increased the NIC threshold for employers and set the annual investment allowance at £200,000.
“Allied to this theme was an appeal to fairness. Support for hard working families will partly be paid by tackling avoidance, clamping down on evasion, addressing “imbalances” such as how the non-dom rules work and cutting back on welfare benefits to ensure that work pays.
“But apart from families and fairness, there is a less trumpeted aspect to the Budget. Most of the money for his give-aways come from targeted tax grabs – an increase in the taxation of dividends for anyone receiving more than £5,000, insurance premium tax, changes to vehicle excise duty and the climate change levy and over £7bn from bringing forward corporation tax payments by four months. Has the Chancellor found the way of “plucking the goose with the least hissing”?
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Jess Liebmann, KPMG Corporate Communications
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This article represents the views of the author only, and does not necessarily represent the views or professional advice of KPMG in the UK.