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| Pictures not appearing correctly? Try viewing in HTML. Our Opinion Formers prepare for the 2012 budget by telling George Osborne what they’d like to see in it. Have you sent us your submissions, demands, and comments yet? Email them to louise.mccudden@politics.co.uk or pressreleases@politics.co.uk. There’s still time! You can see what’s been said so far here, on George Osborne’s page on politics.co.uk.
The loudest points of controversy are taxes. The Liberal Democrats famously want a mansion tax to “pay for” their policy to raise the tax threshold to £10,000 and take the lowest paid workers in the country out of tax. This policy has backing from some Conservative MPs too like Guy Opperman MP who see it as supporting aspiration. Meanwhile a large number of businesses and their representatives, as well as campaign organisations like the Taxpayers' Alliance and think tanks like the Institute for Economic Affairs have all called for the top rate of tax - currently set at 50% on any earnings over £150,000 per annum - to be cut. Advocates of this controversial policy say it will encourage new investors to bring their business to Britain, and with it, jobs - and, significantly, perhaps a net gain in tax revenues overall. But it has been criticised as prioritising the richest 1% of people in the country when the very poorest are facing harsh cuts to pay, services, and benefits. The Federation of Small Businesses (FSB) is calling again, not for a cut in the top rate of tax, but instead, for a cut in the rate of VAT – even if just for a specific area like the contruction sector, which would produce useful things like new homes, as well as . They also call for a reduction in National Insurance Contributions (NICs), which they say could work well if targeted specifically amongst young people, where unemployment is particularly high. Interestingly (a fact that will be ammunition for Living Wage Supporters perhaps), the FSB point out in their submission that they back the minimum wage, and 82% of their members support a higher minimum wage for apprenticeships; they would like to see it go up from £93 a week (only about £30 more than Jobseekers Allowance) to £123 a week. Minimum wage increases are often condemned as anti-small businesses so this statistic should be noted, digested, and remembered. The FSB also call for cuts in fuel tax and other tax simplification measures. You can read their full budget submission here. http://www.fsb.org.uk/frontpage/assets/2012%20budget%20submission.pdf The Construction Products Association agree that a tax stimulus for the construction industry would have a huge positive impact on growth and drive a spurt in development which would create lots of new skilled jobs. They’d like to see VAT cut to 5% for any Green Deal Work. The CPA, whilst keen to do their bit on carbon emissions, would like to see the manufacturing industry given some exemptions from the Carbon Reduction Commitment, as they say the commitment was never originally intended for this sector, and has proven to be a “bureaucratic nightmare.” Read the CPA's full budget submission here: http://www.politics.co.uk/opinion-formers/construction-products-association/article/cpa-writes-to-george-osborne-in-advance-of-his-budget-statem The Building Societies Association (BSA)’s main priority for the budget is to make sure savers as well as borrowers are rewarded. A low Bank Rate, for example, has, the BSA argues, hit savers harder than is necessary. They also call for more promotion of the first-time buyer schemes the government has introduced like NewBuy, which the BSA strongly support. And they would also like to see a reformation of stamp duty land tax which “in its current form hinders property purchases and distorts prices.” Read the BSA's full budget submission here: http://www.politics.co.uk/opinion-formers/building-societies-association-bsa/article/building-societies-association-budget-submission-2012 The Council of Mortgage Lenders (CML) share the enthusiasm for the NewBuy scheme, although they stress that the government must make sure the scheme does not “distort the whole housing market.” However, the CML doesn’t want to see NewBuy undermined either, and there are a number of specific policy areas which they suggest could be “better aligned.” The first of these issues is Residential Stamp Duty. The CML budget submission to the Chancellor says: “We retain our long-standing criticism of the current “slab” structure of residential stamp duty, and believe that it distorts housing market decisions and impedes labour mobility. Its adverse impacts are particularly harsh above the £250,000 threshold, a price bucket that includes a quarter of first-time buyers in London and the south east. The prospect of a sluggish recovery in the yield from residential stamp duty leaves open the doors to longer-term reform, and we would welcome the opportunity to discuss this further with officials.” The CML also criticise the Welfare Reform Bill. They say: “We do of course acknowledge the merits of encouraging personal responsibility… we believe the intended approach has not been fully thought through.” “In practice, most people in work will have in place direct debit or standing order arrangements that ensure that payments of mortgage or rental costs and related utility bills are prioritised automatically. Day-to-day budgeting thus centres on items of discretionary expenditure only, and this is the behaviour that policy should be seeking to foster.” “To our minds, then, the current thinking underlying government policy is wrong in principle. And, just as importantly, we think that, if implemented, it would risk undermining the effectiveness of such support and, ultimately, the extent to which lenders/landlords felt able to rely on it.” The CML are concerned that changes to housing benefits could have a negative impact on landlords’ arrears and are keen to work with the DWP on the demonstration projects advisory group. Similarly, the proposals to reduce housing benefit where a claimant has the use of a spare bedroom are “unlikely to be workable in many parts of the country,” and adds to landlords’ fears about tenants falling into areas. These are just some of the ideas from the CML’s extremely in-depth budget submission. Read more here: http://www.politics.co.uk/opinion-formers/council-of-mortgage-lenders-cml/article/cml-2012-budget-submission Opinion Formers: send your submissions to be posted up – there’s still time! Alternatively, send us your comments post-budget, for the round-up newsletter and blog. | |
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