Nick Forsyth's budget comments

Twas nearly a day of admitting things. He got ever so close. Things might be a little “difficult” at the moment I thought I heard our Chancellor say. They certainly are I thought to myself last night as I sat at Sextons Garage in Marks Tey. I called in because I needed fuel – so the car said 18 miles left - but that’s a trick because I know how to make fuel (or that’s what I used to tell the kids when I eased my foot off the accelerator and the number of miles left increased; they used to be mesmerised) – and I pulled up behind the BMW in front of me as I reasoned he would be pretty quick. He was not and took ages to pat down his hair before taking the fuel cap off. Cars were driving off that had not arrived when I pulled up! I’ve hated the garage since I could fill up my tank and pay £50 to do so. £65.50 last night. How do some families cope is my worry. Are these not the ones who will turn to alcohol and cigarettes to keep the worry at bay? They might be happy that the fuel increase is knocked on the head for 6 months but will they really notice what with all the other rises we have.

Everything in our economy needs fuel to get to our home. Whether it is just in our car or a plane or boat before road haulage provides an outstanding job getting it to the shops. We should not be accepting the pump prices as easily as we do in my opinion but what can we do? Whilst we are held to ransom nothing in the shops will decrease in price. You don’t have to be Chancellor to work that one out. Or do you?

The announcement about carrier bags at the supermarket was outstanding. Is this what Governments are reduced to these days? We re-use ours, well I don’t because I don’t often go to food shop, but many probably do not. Apparently Britain are one of the only ones keeping to the Kyoto treaty. That’s nice but how much more we could do if we did not have vegetables on our table from Argentina? The children like raspberries on their breakfast but they are not in season – unless they come from Spain! I had a word with my own Chancellor (the wife) about having to turn off every light and then eating grub from South America. Cabbage last Sunday – liked it!

Now cabbage is an interesting subject. Most people turn up their noses at it. Boring. Don’t like it. So they don’t eat it. It used to be a staple when you could tell if people were on the poverty line. Today people all look alike. Flash trainers, trousers hanging low showing off plenty of pants, mobile, IPod. Now I’m not saying that people should not have them but it seems all too easy to say the word poverty without giving any real definition. Is a sky dish in or out of the equation as an example? I would be delighted if we could rid ourselves of poverty but is it really possible? New Labour says it is. I am sure that every Government before them have said similar things. The trouble could be that financial mismanagement is often a reason for poverty, or problems with addictions such as alcohol or gambling. At least the Chancellor is putting the boot into alcohol – but does that not stoke the poverty fire again?

I think that the alcoholic drinks industry is in for a turbulent time. I drive home past the Sun Public House in Lexden Road most nights and sometimes it looks closed. The smoking ban has really had an effect. The announcements made today may drive more people to buy from the supermarket and drink at home. Let’s hope they keep to the rules on carrier bags! I heard a man on Radio 4 saying it would add over 10p to a pint of beer in a public house. I hope he is wrong or another trade might bite the dust? Hopefully not – let’s hope summer brings some cheer to our publican friends.

As you probably know by now the devil is in the detail with budgets. It is not what the Chancellor says – as he sticks to the headline points – but what the 270 pages of press releases say that is important.

There is also some “interesting” stuff on contriving a loss by setting up a business to offset your tax bill and working less than 10 hours a week in it. It’s being outlawed or the maximum figure put at £25,000 of losses. How many people does this cover – more than we expect it appears!

The Non Doms £30,000 charge will apply but not to children. Is this how the Premiership footballers escape? No it is not. They will often escape by not being here more than 7 years. The thing is that they can afford to pay it and right away, about a weeks wages for the lowest paid a couple of days for others. It is thought in these parts that it might not be popular with the public if footballers strayed to other leagues. Possibly true but would they? The wages are fabulous and contributed to by most of us – even those in the poverty trap by their Sky subscriptions! It is said 34% may leave who will be expected to pay. No doubt working hard in the City keeping our only vibrant industry ticking. If they leave for Paris or Frankfurt and a trend starts what hope do we have then? Whilst a mainstream rate of corporation tax at 28% is attractive if the personnel don’t like the territory we might have problems.

Now you could say that I am a little downhearted or confused at the present time. Not at all because the best news is left till last. The Income Shifting representations have led to a 12 month delay in publication whilst the Government have time to properly study them. Having spent the last couple of months preparing clients for the worst on this area we appear to have another window of opportunity – and the possibility of some toning down. Let’s hope so.

Anyway, back to the garage. If you are still not buying your own fuel and letting the business pay for it and paying tax on it then you must have either had it calculated and still benefit or not reached the calculation stage yet. As a treat to yourself ask us to do the sums – it might be good for you.

If you want to comment on anything Nick has said send him an email by clicking on his name.

Date:12 March 2008