Editorial for Newsletter #328Monday, December 1st, 2008
This week’s newsletter is dedicated solely to the Pre-Budget Report, published alongside the Chancellor’s Speech to Parliament on 24 November.
It was a landmark Report, not only because it proposed measures intended to address the serious current economic climate, but because it provided all of the tax changes for the 2009/10 tax year – information that is normally only provided in full at the time of the Spring Budget. It opens the way for HMRC to implement all of the 2009/10 tax changes from the start of the tax year instead of from week 7 – although there was no indication in any of the documents that this is the plan.
The changes announced form 2010/11 and 2011/12, which are in part intended to claw back some of the tax reductions given for 2009/10, are based on assumptions on inflation, in particular that, by September 2009, the annual RPI will be negative. This has obvious implications for allowances and thresholds from April 2010.
One particular statement from the Chancellor’s Speech caught my eye. He said “No one under £20,000 will pay any more national insurance contributions as a result.” I suspect that he did not actually mean what this says!
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