Chancellor Sajid Javid had announced that the government’s next Budget will be on 6th November. Only one week after the date set by the Prime Minister for potentially leaving the EU without a deal.
There were doubts that government would be ready to announce a full Budget by then. Despite prior reassurances from the Chancellor, the Prime Minister’s decision to call an election on the 12th December has meant that this date for a Budget is now off the table. Although it does feel like little is certain at this present time.
Why was it set for the 6th November?
We know that Mr Javid said: “This is the right and responsible thing to do – we must get on with governing.” Which is why he set the date so soon after the 31st October.
But the Budget is a hugely important document, done once a year and affecting the whole population. It sets out all the government’s taxation and spending decisions for the following tax year. Meaning that this Budget’s announcements will take effect from April 2020. We all need to know the economic status of our country and how any changes affect our individual financial well being. Will you be paying more tax? Are tax reliefs and allowances changing? Do I have to submit a self assessment tax return this year?
The Office for Budget Responsibility (OBR) is an independent organisation. It usually has 10 weeks to prepare forecasts for the government’s new Budget. These show possible impacts of the different announcements. At the moment, they are ready with data that is based on the UK and Europe negotiating a deal when the UK leaves the EU.
What do people outside the government think?
John McDonnell, the Shadow Chancellor, described a sixth November Budget as “an electioneering stunt rather than a Budget to rebuild our stalling economy and reset the direction of our country”.
SNP leader, Nicola Sturgeon, the Scottish National party leader, said announcing this date for the Budget is “an example of the government making things up as it goes along”. Adding, “I’m not sure they’ll still be in office on 6 November.”
What do we know now?
Now the 31st deadline to leave the EU is not attainable and the prospect of December election is on the horizon, all talk of the Budget is on the back burner. Another element of uncertainty that will only be rectified once an election is held and an agreement with the EU is reached.
We will look at the impact of these things on our tax system, once clarity is achieved by our politicians.