Budgets aren’t what they used to be, says RRL Tax Partner.

March 14, 2011 - PRLog -- It seems strange that anyone can be nostalgic about the Budget, but James Bailey, Tax Partner at Robinson Reed Layton, is reminiscing about how Budgets were at the beginning of his career.

The partner in the well known Cornish accountancy firm explained that back in the eighties the Budget press releases (which, rather than the Chancellor’s speech, invariably contain the really important news about the Budget) could not be downloaded from the Internet a few minutes after the Chancellor sat down in the House of Commons, as they are now.  

“We used to send a junior employee to London on the train, armed with a bottle of whisky for our contact in Her Majesty’s Stationery Office, who in return would throw the first copy of the printed press releases he could get his hands on out of the window to our lad waiting with a taxi in the street below.”

“Our guy would then hot foot it in a taxi to Paddington station and get back with the press releases as quickly as he could.  They would then be photocopied and distributed around the firm and the Tax Department would sit down to plan their speeches for the Budget presentations the following day, and to produce their slides (for an overhead projector, not for Powerpoint!)”

“We got very little sleep if any on Budget night, but I have fond memories of the excitement when we heard our man banging on the door downstairs to be let in with the press releases.”

“Of course the Internet makes things incomparably easier these days, but somehow there was an element of romance in the cross country dash to bring the news to the West Country.”

Meanwhile, when considering this year’s Budget, James wonders if there will be any surprises and is sceptical about the Chancellor’s claim of “openness” about the contents of the forthcoming Budget.

“Draft clauses for the 2011 Finance Bill were published as long ago as 9 December 2010, with a great deal of spin about how this was the end of last minute Budget measures and a more open approach to tax legislation” said James.  

“As a result we already know a number of measures we can expect to see announced on March 23rd.  The damaging legislation concerning the furnished holiday lettings is being introduced in two stages, the first one beginning on this 5 April and the second a year later.  The restrictions on pension contributions have been made a little easier to understand and a little more generous, and we have already been told what all the rates of tax and levels of personal allowances for 2011/12 will be.”

“We have also been informed of some frankly loony proposals. This includes an attempt to restrict the amount of tax free child care an employer can pay for based on whether the employee is a higher rate tax payer or not.  But the decision is based not on the facts but on an employer’s estimate based on only what he pays the employee.  As a result, an heiress who helps out two days a week in a designer dress shop would qualify for the full rate of tax free child care, even if she has a private income of £200,000, whereas, for example, a tax inspector with no private income will find that her tax free child care vouchers (assuming HMRC were generous enough to offer them!) would be restricted because of her level of earnings.”

“There are one or two matters that we are all awaiting with anxiety – the most obvious example being what, if anything, the Chancellor is going to do about the soaring price of fuel, which ultimately affects everyone in the land through its knock on into the cost of goods and services.”

“Finally, although we have been promised a “no surprises” Budget, I cannot believe that this Chancellor will be any better than all of his predecessors at resisting the temptation to spring a few surprises in his speech in order to provoke the usual booing and cheering from opposite sides of the House.”

“One thing I am sure of – there will be plenty for me to talk about when I address our clients at our Budget breakfast in Truro and our Budget lunch in St Austell on the day after the Budget speech, on Thursday 24th March.”

For more information please visit www.rrl-truro.co.uk