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Workers and savers will await details of expected wage rises and pension giveaways when George Osborne delivers his final budget before the general election today.
The Chancellor is expected to hand out more vote sweeteners having already announced a long-awaited review of business rates and a 20p increase in the minimum wage to £6.70.
Nearly nine in 10 business owners are confident about the prospects for the economy in the South East according to a survey by Sidcup-based accountants McBrides, conducted for Kent Business.
Of the 88% who said they were “confident”, one in five said they were “very confident”, with the majority wanting the Chancellor to use the budget to increase the 40% tax threshold and raise the threshold for inheritance tax.
McBrides partner Nigel Kimber said: “The online poll’s results regarding business confidence are encouraging as business confidence helps to stimulate growth, as well as sales and mergers.
“Will Mr Osborne ignore business in favour of vote-winning measures for savers? It would be good to see more to encourage further awareness of research and development – which can be hugely beneficial to firms and start ups – and it would be good to see measures which promote the availability of long-term growth capital.”
With a general election less than two months away, the Chancellor is expected to put workers at the heart of any major announcements, following on from the minimum wage increase, which will see apprentices paid at least an extra 57p to £3.30, an increase of 20% – the biggest ever rise.
James Beatton, partner at Tunbridge Wells law firm Cripps, said: “Incentives and initiatives to encourage businesses to take on and train talent, particularly with skills in technology, is a key priority for a number of companies.
“An extension of the exemption for employer’s NI contributions for all apprentices would be one way to help.”
He added: “The prediction is the Chancellor will use the budget to announce a radical investigation into the 400 year old business rates system.
“High business rates have been a real issue for a number of years now, particularly for smaller ‘bricks and mortar’ retailers who would welcome a reform that would see rates materially reduced.”
The Federation of Small Businesses in Kent is calling on the Chancellor to simplify tax, reform business rates and make broadband more widely available.
Bill Fox, Kent and Medway chairman for the FSB, said: “The improving outlook for the Kent economy is starting to be felt with low unemployment, increasing wages and general business confidence amongst our members.
“What we now need is to allow the reforms that have been made to bed in, and to finish the roll out of those reforms still needing to be put into action. Key issues for Kent businesses are tax, business rates and broadband – we will be looking for commitment in these important areas.”
Clive Relf, tax partner at Kent accountancy firm Kreston Reeves, based in Canterbury, Chatham and Sandwich, said: “This is a general election budget, so there will certainly be some eye-catching offers to voters.
“We expect personal allowances to rise, possibly by £200, with an outside chance that he brings forward his goal for it to reach £12,500 by 2020.
“Mr Osborne announced over the weekend that existing pensioners will be able to cash in their annuities, effectively giving them the same benefits he announced last year for future pensioners. However, those saving for pensions may see a reduction in higher rate tax relief and their lifetime allowance.”
Meanwhile, figures from Kent’s various business sectors are calling for a range of measures.
Ella Brocklebank, who runs Kent Construction Focus Group, said: “The construction industry has shown such positivity in recent months with many local companies enjoying buoyant order books.
“Our members will be hopeful that a strong emphasis is placed on supporting the industry to keep it moving in the right direction towards full recovery.
“We need to get back to the productivity of 2008 with initiatives to keep us building more houses, delivering key developments, repairing roads and improving infrastructure across our county.
“Perhaps the key point about this budget is that it is unlikely to be the last one of the year..." - Clive Relf, Kreston Reeves
“Most importantly the Chancellor must focus on investing in young people and nurturing talent which is vital to ensure we have skilled people to safeguard the future of our industry in the longer term.”
In the tourism sector, Folkestone-based Saga is calling for the government to step in when airlines charge “unnecessary” levies on fuel, bumping up the cost of flying.
Saga Travel spokesman Louis Myers said: “Whilst the cost of fuel has been dropping like a stone, airline fuel surcharges have remained as buoyant as a hot air balloon.
“We believe that people need fair treatment in the air as well on the garage forecourt and Saga is calling for airlines and other travel operators to slash fuel surcharges and give a much needed boost to the travelling public.”
Meanwhile, Swale Heating has urged the Chancellor to find more money for energy-saving home improvements.
The Sittingbourne-based firm wants tax breaks for its energy efficient boilers.
For updates throughout the budget on Twitter, follow @KentBusiness, our political editor Paul Francis @PaulOnPolitics and business editor Chris Price @TheChrisPrice.
Sales director Matthew Edwards said: “Our industry has been campaigning for years to get the government to reduce the VAT rate on high-efficiency boilers.
“It’s morally wrong to keep the rate at 20% when other energy-saving products such as insulation, heat pumps and solar panels attract just a 5% rate.”
Whatever the outcome of the budget, solace may not be far away for those unsatisfied with the announcements.
Kreston Reeves’ Mr Relf added: “Perhaps the key point about this budget is that it is unlikely to be the last one of the year.
“The new government after May, even if it is the existing coalition of parties, may well introduce another budget within months and everything could change.”
