VAT and tax
The government has started a consultation on changes to VAT system following an Office of Tax Simplification report last year which said that some entrepreneurs don’t grow their business because of the tax impact when they reach the £85,000 VAT threshold.
Possible measures include a gradual introduction of 20% VAT above £85,000.
The government is also seeking evidence on how online marketplaces can help people who sell products through online platforms such as Amazon and eBay pay the correct announce of tax.
Hammond said the government is investigating a new “VAT collection mechanism to ensure the VAT consumers pay actually reaches the Treasury”.
In the 2017 Autumn Budget, it was announced that business rates revaluations will take place every three years, rather than every five years, following the next revaluation in an effort to “make bills more accurately reflect the current rental value of properties”.
The Spring Statement announces that the next revaluation, due in 2022, will be brought forward to 2021. “This will mean businesses can benefit from the change to three-year revaluations earlier, with the first taking place in 2024”, the government said.
The government will release £80m to help small businesses recruit apprentices.
Philip Hammond announced a review into the “scourge of late payment”.
Skills and training
Measures are being explored on extending tax relief for training by employees and the self-employed to support upskilling and retraining.
The government is to investigate measures to “understand how best to help the UK’s least productive businesses”.
Human capital and the economy
The government has tasked the Office of National Statistics with working “on a better assessment of human capital, so investment can be better directed”.
A consultation has been launched on “cash and digital payments in the new economy”.
It will explore “how the government can support digital payments and ensure that the ability to pay by cash is available for those who need it, whilst cracking down on the minority who use cash to evade tax and launder money.”
The government has announced a consultation on changes to Entrepreneurs’ Relief “to ensure that it does not discourage entrepreneurs from seeking external finance for their companies”.
At present, entitlement to the special 10% rate of capital gains tax may be lost when an entrepreneur’s company issues new shares and as a result, causes their personal stake to fall below 5%.
The government proposes allowing an individual in this position to elect to be treated as if they had disposed of their shares and reacquired them at their market value just before the time the company issued new shares.
This article appeared on the Enterprise Nation website on the 13th of March 2018