Budget 2015: Yorkshire & The Humber business reactions

Today saw Chancellor George Osborne deliver his sixth budget and Bdaily have asked businesses in the Yorkshire and The Humber area for their reactions to the official statement.

BUSINESS RATES

Helen Dickinson, British Retail Consortium Director General, said: “We welcome today’s official announcement of a ‘radical’ review of the business rates system and we’re looking forward to working with the government throughout the process to make sure a new system is modern, sustainable and crucially - competitive.

“It’s important then to get the review process right, so that we don’t waste this great opportunity and can guarantee that we end up with a system which is better for business, better for local government and better for the communities that retailers and other rate payers serve every day.

“The government is now seeking the views of UK business on a whole range of questions about the future structure of the system. In addition, it’s critical that it seeks an authoritative and independent analysis as the review progresses, so as to ensure the final solutions are based on objective, robust hard evidence.

“There are plenty of interpretations of what fiscal neutrality means and I would encourage that as broad a view as possible is taken. Another positive step forward for the government to take would be to explain what is meant by fiscal neutrality.

“With cross-party political support for a fundamental review of business rates I’m confident that we can put an end to this drag on our local and national economy.”

DEVOLUTION

Councillor Keith, Wakefield Leader of Leeds City Council, Keith Wakefield said: “This does not match our ambitions for the people of Leeds and the city region. We were promised by the Deputy Prime Minister that there would be no strings attached in relation to governance models so we are disappointed by the lack of devolution on transport and housing investment powers. Additionally, given that our Devolved Youth Contract is getting eight out of 10 young people into work compared with three out of 10 on national programmes it’s no surprise that this deal rightly gives us more influence over skills and apprenticeships.

“However, it is no compensation for the £470million of cuts that our councils have had to deliver and it falls far short of our ambition to shape our own economic destiny and create the 62,000 jobs that the people and businesses of Leeds and the city region need.

“We have demonstrated we have the appetite and ability to deliver far more to improve our economy. We shall continue to lobby and campaign for the greater powers and resources, including fiscal powers, that we need to achieve our ambitions and start the process of tackling the north-south economic divide.

HOUSING

Guy Ackernley, Head of Residential at JLL in Leeds, comments: “In this pre-election Budget housing remains a low priority as it is not a part of the winning election ticket. No party has a clear plan either on how to boost housing supply for the long-term – we need cross-party solutions to drive supply and an end to the politicisation of home-ownership. With build rates at barely half current need the long terms solutions for the supply crisis are more important now than ever.

“The Help to Buy ISA for first time buyers can only be seen as a positive, encouraging step, encouraging prudent saving at a time when savings rates available for building a deposit are currently very poor. High house price growth means savings still won’t keep up with deposit requirements. This measure is unlikely to have a significant impact on broader house price growth.”

REGIONAL BUSINESSES

David Anderson, Sales and Marketing Director at Rixonway Kitchens, said: “The Chancellor’s Budget announcement delivered big results in terms of economic growth and support for businesses, as well as laying out plans to increase apprenticeship opportunities and boost employment. It was also refreshing to hear George Osborne recognise the importance of Northern businesses, and Yorkshire in particular, in tackling unemployment.

“I welcome the Chancellor’s pledge to support businesses in providing apprenticeships, with the promise to abolish National Insurance for businesses employing a young apprentice next April. This will enable many businesses, including Rixonway which currently employs 11 apprentices, to take on more apprentices and increase employment and training opportunities.

“The Chancellor also acknowledged the need for more housing and whatever the result of the general election, I would like to see more affordable housing for both private renters and social housing tenants. Rixonway’s work within the sector means we understand the severe lack of affordable housing and that more needs to be done to alleviate housing waiting lists.”

Sean Mallon, CEO and founder of Bizdaq added: “Small businesses continue to be heralded as the “lifeblood of our economy” and yet I still talk to business owners, from cafes to engineering firms, who feel the current government do not offer enough to allow them to thrive and grow.”

“Small businesses employ nearly 16 million people in the UK and therefore the expectation is that the government makes it as easy as possible for businesses to succeed and grow.

“Whilst the existing government have sold us short on a number of their promises (such as selling on shares in RBS) they have also set up a steady foundation for growth on the back of their austerity measures. However, it is undoubtedly time that the government starts spending more on regional projects which will boost small business growth rather than continued focus on austerity”.

TAX REFORM

Nick Scull, partner and head of tax at leading Yorkshire accountants and business advisers Garbutt & Elliott, said, “Despite a lot of political posturing, when it came to the big battles on tax reforms it looks like we are going to have to wait for the “Emergency Budget” after the general election to see any real action.

“Indeed this Budget more than lived up to its billing as a minimalist affair. For most taxpayers the only really noteworthy event was the increase in the personal allowance and the increase in the basic rate band, meaning that the starting point for higher rate tax is income of £42,385 from April. Just how much that saves you depends on so many factors these days, such as the clawing back of Child Benefit and the loss of the personal allowance at higher levels of income. Nonetheless most of us will pay at least a little less tax next year.

“Pensions continue to be tightened up and there were some technical changes to capital gains tax that business owners should review, plus a few tweaks on inheritance tax and a welcome tightening up of anti-avoidance measures.

“We were told that the annual tax return is to be abolished, and this will clearly relieve many of the straightforward cases from the burden of completing an annual tax return. It is no doubt a popular move, although it will take some years to become reality, being phased in by 2020 and much of the detail has yet to be published. HMRC will need to get their act together if their systems are to be capable of managing what is being proposed, given their recent errors with tax calculations and PAYE Coding Notices.

“It has been suggested that taxpayers’ bank accounts will be linked to their “digital tax record”, enabling HMRC to take any tax owing directly from it. Agents will be able to manage their clients’ digital accounts. So those with less straightforward tax affairs, and those who prefer to rely on professional advice to ensure their tax obligations are met and to seek advice on wider tax planning matters, will continue to rely on the services of their professional adviser.”