What can Lancashire businesses expect from the Budget?

On Wednesday, November 22, chancellor Philip Hammond will announce details of his autumn budget. It's the first since the election, which is typically when chancellors make their boldest moves.

James Morris, tax partner at RSM in Preston, also speculates that this could be Philip Hammond's last, which could inspire him to make bold proposals.

He says: "If the Chancellor does feel this is his last budget, might he decide to go out in a blaze of glory?

"Even without Brexit, the UK tax system is at a crossroads. With the tax base shrinking, the question as to who should pay how much tax on what is more important than ever before.

"Reforming the tax system will require a major public debate and a considerable amount of parliamentary time. But with Brexit dominating the parliamentary programme, time is one thing the chancellor does not have.

"However, with the need to restore voter confidence, to reflect the fiscal and economic needs of the UK and to impart a sense of control and order to a government which is perceived to be riven by divisions, there is a growing expectation that the chancellor will deliver a big, bold budget."

However, Tony Medcalf, head of tax at MHA Moore and Smalley, says that lost seats at the election could mean fewer blockbuster headlines in the budget.

He said: "I can’t see anything too radical being proposed this time. Following the narrow win at the election, the chancellor will want to avoid any major own goals. I expect Mr Hammond to stick to his overall message about creating a stable economy over the long term.”

Tony believes this will include enticing announcements for the future generations.

“There’s been talk about the chancellor using this budget to woo younger voters, perhaps by offering some form of tax break to younger people. There’s been suggestions that this could be something around National Insurance Contributions, but we’ll have to wait and see.

“With the continued uncertainty around Brexit, the chancellor will want to be saying that ‘Britain’s open for business’. However, he’s still walking that tightrope of being accused by Labour of offering tax cuts to big business, so I don’t think he can afford to be too over the top.

"The better than expected Q3 GDP figures will probably have eased the pressure on the chancellor to intervene on business taxes. As a result, I think it’s unlikely we’ll see corporate tax rates going any lower than they are already."

Of particular interest to the Lancashire economy could be the chancellor's backing of the £10bn Moorside project.

Professor Andy Gale, the University of Cumbria’s director of industrial strategy, is hoping for government support of work on a new nuclear power station.

The project will create 10,000 jobs during peak construction, and 1,000 when the site is commissioned and under operation. Though the site is located in Cumbria, the economic effects are expected to ripple into Lancashire. Prof Andy said: "The multiplier effect on the economy will be considerable. It is very important that the region is able to retain these incoming skills and the economic benefits that their presence will bring. Also, the infrastructure required, to enable the project, can be intelligently designed to add real value to quality of life in the community."