The UK Budget – Intergenerational Fairness but fair to Whom?

As we approach the UK’s first Autumn Budget for many years on 22nd November, speculation is rife that the Chancellor plans to focus on “Intergenerational Fairness” – in other words to court the votes of the young at the expense of the rest of us.

The concept of intergenerational unfairness may seem flawed to many, as it is only natural that those who have lived and worked longer will have more than those just starting out, but it is a concept which is taking hold of the political scene in the UK.

With a background of 3%+ inflation and the Office of National Statistics saying that the UK has no foreign reserves, £490bn seems to have disappeared, the Chancellor has little room for manoeuvre and so there will certainly be winners and losers in the forthcoming announcement.

Some of the rumoured changes are:
  • Tax breaks for those in their 20s and 30s, perhaps through reduced National Insurance rates, and tax increases for older taxpayers and the better off
  • Reduced pension tax reliefs
  • Raining the threshold for repaying student loans
  • Increasing housebuilding by relaxing planning restrictions on green field sites and providing additional funding for the Help to Buy Scheme
  • Provide tax breaks to landlords willing to grant long leases to tenants

Whilst all of this is rumour one thing is certain, there will be change and you will need to consider how this affects your planning for the future.

We will be hosting a seminar regarding UK Budget on 30th November 2017, please keep a look out for the seminar invitation in the near future.

Sources:
http://www.telegraph.co.uk/business/2017/10/15/britains-missing-billions-revised-figures-reveal-uk-490bn-poorer/

http://www.dailymail.co.uk/news/article-4984798/Half-TRILLION-pounds-wiped-Britain-s-wealth.html

https://www.ons.gov.uk/economy/inflationandpriceindices

https://www.ons.gov.uk/economy/nationalaccounts/balanceofpayments

Ian Black
Head of Wealth Solutions
AAM Advisory Pte Ltd

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