Osborne’s election Statement puts focus on homebuyers and tax avoiders

Chancellor George Osborne sought to help homebuyers and savers while announcing more punitive measures for tax avoiders and banks in today’s Autumn Statement.

Firms involved in R&D and first-time exporters can benefit from new measures unveiled as the Chancellor sought to talk up the UK economy, with forecasts coming in higher than the pre-statement predictions had suggested.

It was described by Andrew Coticelli, partner and head of tax at Deloitte in Yorkshire, as “a pre-election Autumn Statement” with a raft of measures designed to appeal to the electorate.

“It was certainly a confident performance from the Chancellor, helped by the fact that the forecasts were in the main better than what people were anticipating,” he said.

“The Chancellor had some very positive things to say about the UK being the fastest-growing advanced economy in the world and his message was ‘let the current government finish the job’.”

Homebuyers and savers will have been cheered by measures on stamp duty and savings, but multi-nationals and banks fared less well.

Mr Coticelli said: “The big winners are people buying houses given the changes to stamp duty with 98% of people paying less stamp duty aftermidnight tonight. He also looked to reward savers, through abolishing tax on death for pensions, ISAs and annuities.

“There was a continued commitment to tackling anti-avoidance and evasion. There was a particular focus on multi-nationals who try to divert profits from being taxed in the UK, and the government has reinforced their commitment to the base erosion and profit shifting agenda.

“There were some specific measures, including on the use of hybrid structures, but we need to see how these play out. Some of these measures do require clarification and some will require international agreement.”

The Treasury is expected to benefit from announcements restricting how banks use previous losses to reduce their tax liabilities.

“The Chancellor is continuing his focus on the banks, and large amounts of revenues have been raised by the LIBOR fines, which will be used to fund the NHS,” he added. “There will be restrictions on banks’ ability to offset future profits against historic losses, which is anticipated to be a significant revenue-raiser for the Treasury.”Yorkshire manufacturers and SMEs can look to benefit from packages to help research and exports, that were announced today.

Mr Coticelli said: “Manufacturing is the fastest-growing of any sector which for this region is a good thing to hear. Increased measures for R&D tax credits as well as a £45m package to help first-time exporters which should be good for SMEs.  There is some positive communication surrounding the Northern Powerhouse proposals relating to science and infrastructure investments, but the impact of this is still to be seen.”