Budget predictions: Positive action needed for brighter future
Barry Smith, head of tax at professional service firm PricewaterhouseCoopers in the Midlands, hopes Alistair Darling uses the Budget to address the nation’s growing deficit and to modernise the tax system.
Budgets are traditionally upbeat, containing good news and messages of encouragement.
But it is hard to see how the Chancellor of the Exchequer can paint a rosy picture of the UK’s position and prospects this time around.
The best he can do is to stress that the UK’s position is in line or slightly better than some other countries.
There is no doubt that the fiscal gap is widening and PricewaterhouseCoopers latest projections are for a fiscal gap equivalent to three per cent of GDP in 2013-14, which is equivalent to around £43 billion at current values.
Despite the pessimistic economic outlook, the Chancellor can still be positive in setting out strategies to address the growing deficit and do more to modernise the tax system.
Changing the foreign profits proposals, in response to concerns already raised by corporates, could pave the way for a more internationally competitive UK business tax system.
