The Budget is set for Wednesday 11 March and, as ever, the team here at Charter Tax will listen intently to the speech, before producing a summary which will be available for our clients by email (and added to our website) later the same day.
With our many years of experience, we are well placed to identify what the various announcements and changes will mean to our clients.
Since the date was originally set by the then Chancellor, Sajid Javid, he has resigned and been replaced by Rishi Sunak. Speculation followed as to whether this might see the Budget postponed, but Chancellor Sunak tweeted recently that he was ‘cracking on’ with preparations and would ‘deliver the promises’ made to voters ahead of December’s general election.
Chancellor Javid had said he would be using this Budget to ‘prioritise the environment’ but we will wait to see exactly what this will mean to our clients.
Mr Javid told the BBC when the Budget date was announced a few weeks ago: "We set out in our manifesto during the election how we can afford to invest more and take advantage of the record low interest rates that we are seeing but do it in a responsible way. There will be up to an extra £100 billion of investment in infrastructure over the next few years that will be transformative for every part of our country.”
The word Budget comes from an old French word ‘bougette’ meaning little bag. The distinctive red Budget Box which Chancellors used to carry their speech from 11 Downing Street to the House of Commons was in use for over one hundred consecutive years.
In common with Chancellors before him, on 11 March, Mr Sunak will no doubt hold his red box aloft before making his way to the House of Commons. This tradition is said to have been initiated following an incident in 1868 when the then Chancellor, George Ward-Hunt, apparently left the red box and his speech at home.
As a firm, we are busy helping both individuals and businesses to run their affairs as efficiently as possible and helping them to balance their books and, in many ways, the Budget aims to do this for the country as a whole. It is a combination of a financial statement made by the Chancellor of the Exchequer on the nation’s finances and the Government’s proposals for changes to taxation. The Budget also includes forecasts for the economy by the Office for Budget Responsibility (OBR).
Our advice to the businesses and families we deal with helps them to plan financially for the future whatever that might bring. It was not being prepared which led to there being a Budget in the UK in the first place and it was initiated by Sir Robert Walpole when he was Chancellor of the Exchequer. The Budget was introduced to restore the confidence of the public in the aftermath of the of the South Sea scandal in 1720.
The South Sea Company was a British joint-stock company founded in 1711 as a public-private partnership to consolidate and reduce the cost of the national debt. To assist in the generation of income for this purpose, the company was granted a monopoly to trade with South America and surrounding islands.
However, there was no realistic prospect that trade would take place and, as it turned out, the company never realised any significant profit from its monopoly. However company stock rose greatly in value as it expanded its operations dealing in government debt, and peaked in 1720 before suddenly collapsing to little above its original flotation price; the economic bubble thus created, which ruined thousands of investors, became known as the South Sea Bubble.
Three hundred years later, the 2020 Budget, as in Budgets gone by, will have at its heart a goal of building public confidence.
If you are a client of Charter Tax, then keep an eye out for our email on Budget day which will give you an overview of what the various announcements mean for your family and your business. Alternatively, we will post this document on our website too.
If you have any questions at all on how the changes will impact you, please do get in touch on 01580 313108 or 020 7084 5771.
