In my last post, I wrote about the hardships that the proposed abolition of taper relief would cause to small businesses. I am therefore somewhat happy to read today that Gordon Brown is considering a U-turn.
Under the revised plans, when a business owner comes to dispose of his business, capital gains of up to £100,000 would be exempt, with the rest taxed at 18 per cent. Also, the taxpayer can only claim this relief once in his lifetime. This looks suspiciously like the old retirement relief rules, which were abolished by Gordon Brown sometime ago. This won’t be the first time Gordon Brown has abolished something, only to revive it in another form. It gives the impression that this Government lacks a coherent policy on tax. And as is the case where such uncertainty exists, it is the taxpayer who suffers the most.
Still, I am glad that some measure of relief is being given to small businesses. But what about employees who have shares in their company share schemes? With effect from 6 April 2008, the effective 10 per cent rate will be withdrawn for them, and they will pay capital gains tax at a rate of 18 per cent. I would like to see another U-turn by Gordon Brown to afford some relief to this group of taxpayers.
October 31st, 2007 at 10:29 am
The only problem, of course, is that to balance the books (having cooked them often enough) Brown and Darling will have to tax some other group unfairly …
October 31st, 2007 at 5:17 pm
Mountjoy - you appear to assume that there is something that can be universally considered (even assuming a utopian universe of rational creatures) as a ‘fair tax’. Any examples?