Budget Week and What is in the News?
5th March 2021
The Chancellor’s self-promotion and prominent position in the Cabinet have led him to be dubbed Dishy Rishi by his admirers. And in the run-up to Wednesday’s Budget, Sunak was hardly camera shy. The 40-year-old posted an almost six-minute-long video on Twitter on Monday reflecting on his past year in No 11 – which has since been viewed more than 700,000 times. Can anyone imagine ‘spreadsheet Phil’ being on Twitter and having a video of himself prior to his last budget. I understand, this has raised eyebrows in Westminster and seen the Chancellor installed as the 5/2 favourite to be next prime minister by Ladbrokes. Sunak has an approval rating of 41 per cent, according to a YouGov poll, making him one of the most popular chancellors in recent years. Watch out Boris. Time to visit the Barber (once they open in April of course).
So, here are a couple of the headliners from the Budget and our thoughts:
- Income, CGT and IHT Thresholds all frozen until 2026. As far as we can see, nothing in the budget today stops IHT mitigation as we know it. ‘We can still make large tax-free gifts, transfer assets into trust and opt to pay the lower rate of CGT on any gains rather than suffer the death rate of 40% IHT’. Corporation Tax to rise to 25% in 2023.
- Corporation tax is a tax on profits, not turnover, so it is only a tax on businesses that are thriving. ‘The worst thing we could have had was more changes to pensions or savings legislation, particularly with so many people having to adjust their retirement plans due to the pandemic. So, a tax that puts more burden on successful businesses without impacting ordinary savers or retirees makes a lot of sense.’
These are also very much worthy of a mention, especially as we follow our roadmap out of lockdown:
- Fuel duty and alcohol duties are frozen.
- Coronavirus Job Support Scheme extended to September 2021 across the UK (employer contribution of 10% required in July and 20% in August and September).
- Self Employment Income Support Scheme (SEISS) extended to September 2021 across UK, with those who filed a tax return in 2019/20 now being able to claim for the first time.
- Stamp Duty Land Tax (SDLT) temporary cut in England and Northern Ireland extended until September 2021. The £500,000 nil rate band will be extended until 30 June 2021 then it will be set at £250,000 until 30 September 2021 returning to its standard level of £125,000 on 1 October 2021.
- New mortgage guarantee scheme to enable all UK homebuyers to secure a 95% mortgage on properties up to £600,000 – only a 5% deposit needed.
In the News This Week
As you know, I like to add in a few little news stories that have either made me smile or cringe!
In the news this week, we have:
- Free Trip to the Moon – A Japanese billionaire has invited eight members of the public to join him for a free trip around the moon on Elon Musk’s SpaceX flight. “I want people from all kinds of backgrounds to join,” said Yusaku Maezawa in a video on Twitter. He says the successful applicants will advance “whatever activity” they are in to “help other people and greater society in some way” and be willing to support other crew members who share similar aspirations.
- Fat Chance – a healthy 32-year-old man was offered a Covid vaccination last week, because in his NHS files he was recorded as being 6.2cm tall and morbidly obese. Liam Thorp, who is in fact 6ft 2ins and weighs 17.5 stone said he had been surprised to be offered the jab months ahead of schedule. So, he checked with his local GP surgery and discovered that as a result of being listed as 2 inches tall, officials believed he had a BMI of 28,000 (or around 1,000 times the UK average.
- Dolly Parton has been given a Covid-19 vaccine after urging others to follow her example by adapting the lyrics to one of her hit songs, Jolene. “Vaccine, vaccine, vaccine, vaccine, I'm begging of you, please don't hesitate,” sang the 75-year-old in a video before receiving the Moderna shot at Vanderbilt University Medical Center in Nashville, Tennessee yesterday. Parton has donated $1m (£716,000) to the centre. Great work Dolly!
…and finally, you may remember I did my little obituary to Eddie van Halen a few months ago. For all you cycle fans, you must see this paint scheme for a custom bike which was inspired by the iconic Eddie Van Halen 'Frankenstrat' guitar. Firstly, I love the paint job and who would not want to own a by the UK bike brand Windymilla. Inspiring!
As always, stay safe, healthy and keep a sense of humour.