ACCA: Spring Budget must include Brexit-proofing measures

Tuesday 7 March 2017

The Chancellor should introduce measures in the Spring Budget to protect policies in danger of being changed by Brexit, the Association of Chartered Certified Accountants (ACCA) has recommended.

In a letter to the Chancellor, the ACCA offered advice on how to make the budget more friendly for the accountancy sector. It urged the government to consider stimulating consumer spending and introducing a fiscal commission of employers to inform policymaking.

ACCA believes there could be a slowdown in consumer spending that should be protected with fiscal measures that cover disposable incomes and savings. It wants to see inflation-linked rises to income tax personal allowance, along with a higher rate threshold. 

The group also wants to see a long-term approach to tackling Brexit, suggesting that the assumptions of the Comprehensive Spending Review need to be re-aligned with the effects of Brexit in mind. ACCA believes that any decisions made on a short-term cycle could worsen the uncertainty caused by Brexit. 

ACCA cited small and medium-sized enterprises (SMEs) as vital for the country’s productivity. It wants to see more financing options to boost more export activity and promote the work of bodies in the field. 

Extra changes to the penalty systems for VAT, PAYE and SME-focused non-payment insurance products are also recommended by the group. On top of this, it wants to improve debt relief on PAYE and National Insurance Contributions for SMEs.

ACCA also wants to see more incentives introduced to boost innovation in information sharing throughout the public sector. It believes more collaboration is required in public service provision, or investment could be wasted. 

Freelancers across the country will need to keep up to date with any regulation changes in the coming months, though they can save time and hassle by using an umbrella company. These businesses can ensure invoices for self-employed professionals are properly managed and fully within the law. 

Chas Roy-Chowdhury, head of tax at ACCA, said: “The recent depreciation of Sterling alongside rising energy costs will be likely to contribute towards increased inflation which will eat into disposable incomes. 

“In our view, this furthers the need for fiscal policies that encourage strong sustained consumer spending as a key pre-requisite to a strong economy.”

Mr Roy-Chowdhury wants the government to introduce fiscal measures to boost SMEs and make it easier to improve exports, which he believes will be vital once UK leaves the EU. 

By Victoria McDonnell

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