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Spring Budget 2017
Taxand UK analyses the Spring Budget 2017.
As expected, the Chancellor lived up to his reputation as a cautious operator and made very few significant tax announcements in his final Spring Budget. Both the medium-term economic policy and the direction of travel of the tax regime were confirmed, and the government will proceed with the gradual reduction of corporation tax rates and the introduction of interest and loss relief restrictions.
The most notable announcements were also widely trailed. The Chancellor has sought to bring the self-employed and those using personal service companies into greater alignment with employees by increasing the main rate of Class 4 National Insurance Contributions by 2% over the next two years, and by reducing the new tax-free dividend allowance from £5,000 to £2,000. Further attention to this area can be expected following the Taylor Review of Modern Employment Practices, which is due to report in the summer.
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There was the usual crop of small anti-avoidance provisions to address particular issues, and some welcome amendments to the corporate interest restriction rules to alleviate particular concerns, but no other announcements of note. It may well be that the Chancellor is deferring any more significant changes until the first of his Autumn Budgets later this year.