Forecourt Trader - 30 years at the heart of the fuel retailing community

Money Talk: Budget 2015 (the March one)

It was always likely to be a strange Budget coming as it did just seven weeks before the General Election which looks highly likely to end without any clear winning majority. The Chancellor had to stand up and deliver a Budget that somehow appealed to his existing voters but didn't scare off those who might be thinking of joining them on May 7; and do so in the knowledge that he might not be in a position to put his announced measures into practice after that date.

As far as 'business' was concerned, there had already been one significant announcement the day before the Budget itself advance notice of increases in the National Minimum Wage rates to come into effect from October 1:

Age 21-plus£6.70/hour

(up from £6.50)+3.1%

Age 18-20£5.30

(up from £5.13)+3.3%

Age under 18£3.87

(up from £3.79) +2.1%

Arguably, as far as petroleum retailers are concerned, that announcement was going to have a more direct impact on their businesses than anything that would be announced in the Budget speech particularly since the figures will be implemented regardless of any probable election result in May.

Now we know from our Annual Pay Report that many retailers already pay more than the minimum wage rates, but the increase in those rates does set the bar for future wage expectations, so the figures need to be programmed into the financial plans for each business later this year.

End of the tax return?

Well, not quite, but as a 'leak' headline it created a bit of a stir, and may come to have a significant impact on many self-employed and/or small business operators in the next few years. It was revealed that HMRC intends to 'encourage' tax-payers to file digital tax accounts in real time, using a tablet or smartphone to submit financial information at regular intervals during the year rather than a single annual submission date for tax returns. The proposals even include a permanent link between accounting software, bank account and tax information for individual tax payers by 2020.

All of this was presented as another attempt to ease the administrative burden on individuals and small businesses. Maybe, but this should ring a few alarm bells. Anyone with experience of dealing with HMRC, or just chatting with some of the people who work there, will know that existing IT systems within that organisation are stretched, to put it politely. So how these systems would cope with even more activity is mind boggling. Ignoring immediate and very real concerns regarding security and privacy, this looks very much as if government is increasingly concerned that the 'tax-take' from non-PAYE workers and small businesses is not as high as they'd like they'd prefer the sort of regular cash flow that they used to get when most of the adult population paid tax and National Insurance weekly under PAYE, with very little interference or delay between source and destination.

While 2020 may sound a long way off, the first steps in this scheme are to be implemented from 2016; so those who currently leave any sort of accounting until December or January may soon have no choice but to implement more regular accounting.

The Budget itself

Fuel Duty frozen. The next review, scheduled for September, has been cancelled. Of course, this does assume that any incoming government will maintain that policy. It would have been interesting to have seen whether the Chancellor would have resisted tinkering with Fuel Duty had pump prices remained quite as low as they'd been in January, or even fallen further!

Tobacco and gaming taxes unchanged. Would any Chancellor want to announce an increase just weeks before a General Election?

At least there's no excuse for tobacco manufacturers or wholesalers to try their usual trick of adding a couple of pence to the price of a packet alongside any Duty increases, which should come as something of a relief for those retailers already struggling with the implementation of display restrictions, etc.

Alcohol duty: beer cut by 1p per pint; cider and spirits cut by 2%; and wine unchanged.

Tax-free personal allowances increased from £10,000 in 2014/15 to:

£10,600 in 2015/16

£10,800 in 2016/17

£11,000 in 2017/18

Higher-rate tax threshold (ie at which the 40% tax rate comes into effect) also increased from £41,865 in 2014/15 to:

£42,385 in 2015/16

£42,700 in 2016/17

£43,300 in 2017/18

Class 2 National Insurance contributions there was an almost throwaway line in the Budget speech which several media outlets seized upon as the 'abolition' of Class 2 NICs for the self-employed. However, digging a little deeper into HMRC's Budget documentation revealed: "As part of the planned reforms to tax administration, the government will abolish Class 2 NICs in the next Parliament and will reform Class 4 to introduce a new contributory benefit test.

"The government will consult on the detail and timing of these reforms later in 2015."

So nothing immediate, and another policy which really depends on the outcome of the Election.

Leaving aside the political hot air and vague notice of good intentions such as tackling tax evasion by multi-nationals there wasn't much else to affect small businesses in the immediate future.

Despite some media speculation that the Budget might include potential changes to business rates in England and Wales, which would have been relevant to very many forecourt operators, that proved to have been a red herring, and there wasn't even a whiff of any proposal to address the subject 'in the next Parliament'. Well, it was a short Budget speech.

Want more stories like this in your inbox?

Sign up for our FREE email newsletter

Keywords:

My Account

You are not logged in.
  • Weekly
    Retail
  • Weekly
    wholesale
  • Daily
    Average
Weekly retail fuel prices: 13 November 2017
RegionDieselLPGSuper ULUL
East122.9762.90129.22120.30
East Midlands122.51131.19120.13
London123.0159.23131.32120.49
North East122.2163.40130.26120.15
North West122.3953.80130.05119.91
Northern Ireland121.09125.70118.82
Scotland122.68128.95119.79
South East123.2069.90130.92120.88
South West122.77128.85120.30
Wales122.4253.90128.26119.82
West Midlands122.0958.90130.41119.94
Yorkshire & Humber122.3453.70132.45119.99

Most read

As many forecourt operators continue their quest for expansion - driving up forecourt prices - could you be tempted to sell your business?