The annual ’excitement’ of the Budget is looming but I dare say few of us envy Mr Osborne’s job next week. Apart from the obvious heckling and vegetable throwing the Chancellor will no doubt be ducking, we have another opportunity to see whether the Government has the plans and vision to deliver its reported aims and agenda for growth.
We have heard much since the election of its desire to eradicate bureaucracy and to simplify our tax system and whilst we know that the top rate of stamp duty land tax is to increase, I have fingers and toes crossed that there will be no further burdens put on our sector.
There has been much positive talk of building a more competitive tax system to stimulate inward UK investment (rings a few bells from a bygone era?) and hopefully we will hear of how this might happen next week.
My new corporate tax partner here – Elliot Weston – is of the view, for example, that too little attention has been given to REITs in recent years. I agree. It seems hardly to feature in conversation since the FTSE big boys converted and other players struggled to find a way of benefiting from the opportunity to convert. Perhaps simplification of the regime for REITs and ownership rules could stimulate UK investment without upsetting the budget deficit applecart?
I imagine REITS are unlikely to feature next week but at least thought is being given to the property sector with the promise of simplification in obtaining planning permission for housing and, in particular, change of use from office to residential use. It might be easy to see this promise as skirting the issue and unlikely to have any significant impact. Unless there is a significant quantity of aged offices ripe for conversion in the green belt?
I’m also not sure how planning is the Chancellor’s remit now but thankfully he is indicating his intention to ’simplify’ our tax system and our planning system. Ultimately, curing housing shortages may need a universal planning policy presumption in favour of granting consent for residential use which is only rebuttable by local planning authorities in limited circumstances. The trouble for the Government is that central directives and policies are not only controversial and tried and tested vote losers, but they also conflict with the ’big society’ mantra and its message for localism. Whilst quick change is needed to promote growth and, in particular, create a better environment for developers to combat housing shortages, let’s just hope legislative changes which will surely follow (and with vested interest in its drafting) is well considered and thought through after full consultation with the key industry stakeholders. Not something I was ever particularly convinced the Government’s predecessors excelled at.