Finance & Leasing Association (FLA) director general, Stephen Haddrill, reflects on the spending and tax measures, including the full expensing regime in the UK Spring Budget of 2023.
The Chancellor’s prediction that the UK will hover around a zero growth rate this year is far from exciting news but it marks a definite shift from the bleak prophesies made by many last year.
The Chancellor has also secured OBR endorsement of his figures despite a significant number of spending and tax reduction measures, another step forward from the anxieties that swirled around his predecessor’s budget. The ship of state seems a lot steadier and there is reason to believe the climate for business finance will strengthen.
Many of the new measures are aimed at fostering enterprise and investment by reducing the tax burden on business. We particularly welcome the introduction of full expensing of investment for tax purposes which we pressed the Treasury to do. This will apply to HP-funded investments but it is not clear that leasing will benefit. We continue to push for that.
The focus on increasing the size of the labour market is also to be welcomed. FLA members, in common with most of the economy, have struggled to recruit since the pandemic.
The abolition of the Lifetime Pension Limit to encourage older people to stay in work is a radical step as is the decision to allow disabled people to retain benefits when they find work. The measures to help parents with young children will be welcomed by many too. The Government appears to be focused on finding a sweet spot between helping the economy and helping the disadvantaged. It is not a dramatic Budget. It contains little tax-and-spend rhetoric. But in combining the economy and social policy it is a pointer to where its manifesto for the next election will be pitched.
This article post first appeared on the FLA website