Chancellor to seek ‘safe haven’ in Green Budget

PKF National Tax Director Lisa Macpherson believes the move is even more likely following criticism in the media by CBI Chairman Martin Broughton of Treasury ‘back of a fag packet’ policies and the recent announcement of a Conservative plan for a Green Environmental Market to sit alongside the Alternative Investment Market (AIM). Lisa commented: “Following the furore around the Pre-Budget Report, the Chancellor will want to deliver a Budget that does not draw further protest from the business community. He currently has to address a number of outstanding issues on non-domiciles and CGT as well as the new entrepreneurs’ relief and it is likely he’ll want to divert attention from these if he can.

1. New reliefs for investment in carbon capture and storage technology. While the move would be likely to involve a windfall tax on oil and energy companies, the industry’s profits would make this politically acceptable.
2. Delays to fuel duty increases, which would be popular, will depend on whether the Chancellor has been able to balance his Budget.
3. An airplane tax on every flight replacing air passenger duty is likely to be confirmed along with additional taxes on vehicles with high CO₂ emissions.
4. Stamp duty land tax for residential property could be linked to its energy efficiency. Energy ratings for Home Information Packs make this possible, however, it would be a controversial move.
5. New tax incentives for investing in green energy generation may be announced following the Chancellor’s remarks in recent months over energy security and renewable energy.
6. A plastic bag tax now seems more politically acceptable following recent comments by the Prime Minister and initiatives by major retailers.

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