UK Accountants Hope For Balanced Emergency Budget.
Paul Grant, for Accountancy Age took the trouble, the the run up to the Government’s emergency budget in June 2010 action, to survey Accountancy firms that specialise in mid size and small businesses. Accountants seem concerned that any budget avoids fiscal actions that may adversely affect the UK’s delicate economic recovery.
Accountants appreciate the value of VAT and Capital Gains (CGT) Tax rises to address the unsustainable Government debts, which the previous administration seem hell bent on maintaining was a credible stance.
Local Small Accountancy Firms in the UK hope the UK Government will seek to balance any tax rises with the following measures:
- Abolition of employer’s national insurance to encourage employment.
- Corporate tax cuts – reducing small company rate
- Revise IR35 legislation which is cumbersome
- Simplify accounting and tax legislation
- Higher-rate relief for pension contributions.
- New VAT rate no more than 20% to avoid definitive double dip recession
What is the likelihood of a double dip recession? According to Reuters Global Economy News a Double-Dip recession cannot be ruled out. Europe’s debt crisis could make investors lose faith in efforts in Europe and elsewhere to tackle rising debt levels. The World Bank’s Global Economic Prospects 2010 report said slower growth in developed economies would deprive developing countries of healthy markets for their goods and would cut into investment. The World Bank Financial Crisis points to other highly-indebted countries, like Spain and Portugal, who are not too dissimilar financial crisis as Greece.
The World Bank is encouraging the major industrialized countries to take advantage of any business opportunities offered by stronger growth in developing countries to boost economic activity globally .
The World Bank has reportedly forecasted developing economies to grow by between 5.7 percent and 6.2 percent each year from 2010 to 2012, which is twice the growth rate of advanced economies and much greater than previous years (e.g. 2009) which was under 2 percent.
