‘We have never talked so much’ about a Budget before it takes place, Walker Crips business development manager Alan Kinnaird told Money Marketing.
Kinnaird was referring to Rachel Reeves first ever Budget on 30 October as chancellor.
He added that the only time he could remember a similar amount of discussion before a Budget was when then-chancellor Gordon Brown in May 1997 stunned the City and Westminster by handing control of interest rates to an independent Bank of England.
Brown’s first Budget then came in July of the same year, with the BoE announcement resulting in a lot of discussion beforehand.
Regardless of all of the talk surrounding the Budget, Kinnaird said it was “impossible to know exactly what will be announced” and explained that no one he has spoken to “knows conclusively” what Labour will do.
He added that the best advice he or anyone can give right now is “sit tight, wait and see what happens”.
He is hoping any changes announced by Reeves will not come into effect until the next tax year as any “overnight changes would be bad”.
Usually when heightened emotions occur before a Budget, the government steps in to clarify certain points will not happen. He hopes that for the next Budget, Labour will engage more with the media in order to control the speculation.
Regarding the specific rumour the government may scrap the inheritance tax (IHT) relief on Alternative Investment Market (AIM) stocks, “Labour would be shooting themselves in the foot if they did this”, Kinnaird said.
Previously Chelsea Financial Services and FundCalibre managing director Darius McDermott told Money Marketing that if Labour do this “it could be as damaging for smaller companies as Liz Truss was for the gilt market”.
Any new government looking to raise tax can be “pretty imaginative”, especially as you can tax “anything”, hence the wide scope of predictions.
Still, any uncertainty surrounding a business that the Budget is creating “is not good”.
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