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Budget coverage

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The first Conservative Budget for 19 years sees ‘Osborne unbound’, writes Chris Sanger (global head of tax policy, EY) in Tax Journal. This was ‘a reforming Budget’ which sets out plans for a lower tax future ‘but boosts the exchequer’s coffers greatly in the short term’.

It was also ‘a surprisingly big Budget for big business’, reports Dominic Robertson (partner, Slaughter and May). The shock announcement of further cuts to corporation tax shows that the government is serious about the UK being  ‘open for business’. But this is offset by a requirement for larger businesses to pay up early. And there is to be a tougher CFC regime, too.

The ‘war on non-compliance continues apace’, writes James Bullock (head of risk, Pinsent Masons) - with consultation due on GAAR penalties and further measures for ‘serial avoiders’. HMRC powers for direct recovery of debts didn't feature in the Budget speech but they are due to be enacted soon. Not much was genuinely new, though, ‘except for the rhetoric’ which moves up a notch. The promised £5bn clampdown on avoidance and evasion is expanded to tackle ‘imbalances’ in the tax system, such as dividend taxation. ‘One wonders which of today’s tax reliefs will be tomorrow’s “distortions”’, writes David Whiscombe (tax technical director, BKL Tax).

Changes to the non-dom rules were widely expected, but the scale of reform surprised many. There are some popular measures for Middle England, but some bad news too - such as the dividend changes, and reduced tax relief for buy to let mortgages. And the removal of tax relief for goodwill and intangibles with immediate effect had many advisers scratching their heads. As Sue Laing (partner, Boodle Hatfield) observes, ‘the chancellor giveth but he also taketh away’.

Tax Journal's special Budget edition is free to download here.

Click on the links below for our online coverage.