MHA Moore and Smalley tax partner Tony Medcalf explains why this year’s low-key Spring statement will be welcomed by the business community.
When chancellor Philip Hammond gives his Spring statement next week, there will be no red boxes, no posing for the cameras in Downing Street, and no big tax and spending announcements.
What used to be our regular mid-March fixture is widely expected to be replaced by a speech just 15-minutes long.
It follows the chancellor’s decision last year to move the main Budget to the autumn and replace what was the Autumn Statement with a light-touch Spring Statement, consisting mainly of a brief response to the OBR’s current economic forecasts.
So, while financial journalists and commentators may be at a loose end next Tuesday afternoon, the slimmed-down event should be welcomed by business owners.
It made little sense having two major fiscal events in the same year. Just as businesses are getting their heads around one set of tax changes, along comes another just a few months later.
Businesses are already dealing with enough uncertainty with Brexit and a long list of other financial and legal requirements. These include workplace pension changes, the Making Tax Digital regime, and changing data protection laws to name just a few.
We know this year’s Spring Statement will be different because the Treasury has been seeking to play down its significance since late last year in a series of behind-the-scenes media briefings.
Aside from the government’s response to the OBR figures, the chancellor may use the statement to launch some consultations, sowing the seeds that could result in actual fiscal changes in the Budget later this year.
But the clear and consistent message coming out of Number 11 is to “expect very little”. I would imagine most business owners will happily settle for that.