BUSINESSES in Scotland want the Chancellor to announce no further tax changes until 2026 at the Spring Budget, according to a new poll from accountancy and business advisory firm BDO.
In its pre-Budget survey of businesses and private clients, 46% of respondents called for no tax changes to be announced at next week’s Budget. This contrasts with the rest of the UK, where 48% of businesses favoured a corporation tax reduction plan over the next five years. In Scotland, only 29% believe a reduction of corporation tax is the top priority, while only 16% thought that further business rate subsidies should be the priority.
When asked which taxes should rise to pay for tax cuts elsewhere, the most popular choice selected by nearly half (46%) of respondents in Scotland was a properly targeted windfall tax on energy companies. This came ahead of taxes on personal wealth (21%) and green taxes (8%). Meanwhile 25% of those surveyed said no taxes should rise and none should be cut.
The survey also sought to canvas business views on the ways the Chancellor could attract more of the ‘economically inactive’ – and particularly the retired – back into the workforce. According to Government figures, there are currently 6.6m people of working age who are currently neither in full-time education or employment. In total, 45% of respondents favoured cutting the rate of National Insurance Contributions for both the returning employee and their employer and another third suggested enhancing state pensions for those who work beyond their 30 qualifying years.
Commenting on the findings, Martin Bell, partner and head of tax, said:
“Businesses are continuing to tell us that, above all, they are looking for certainty and targeted support. Given the ongoing political uncertainty in Scotland, businesses here need a period of stability to make the investment decisions that will underpin future growth and they’re seeking support to help close the skills gap so they can deliver against their ambitions.
“There is some pressure on the Chancellor to reduce corporation tax rates – both from business groups and from some within his own Party. While it’s highly unlikely this will happen immediately, businesses would welcome a roadmap which signposts future reductions. This would provide some much-needed certainty for business planning and signal to overseas businesses that the UK is a good place to invest in the long term.”