Author
Alan Vallance, CEO, ICAEW
Date published
October 23, 2024
Categories
You might wonder what 500 ICAEW members discussed at our annual conference earlier this month – spreadsheets, tax returns, book-keeping? No.
We gathered in the City of London for ICAEW’s annual conference to consider the challenges faced by UK plc – and how together we can build an economy fit for the future.
Change is needed. Our conference – my first as CEO – was a chance for ICAEW members, who are trusted advisers to more than three million businesses in the UK, to hear from top policymakers and prominent industry experts about issues affecting the world of business. When the Bank of England’s chief economist Huw Pill delivered his keynote speech “What’s next for the UK economy?” for example, our members were listening with keen ears.
The first Budget of our new government is just a week away – it’s a golden opportunity to take the big decisions needed for the long-term. At ICAEW we believe reviewing the tax system should be a clear priority for Labour, and reforms to VAT, employment status and business rates, which are not currently conducive to economic growth, should be central to this, thereby removing barriers.
We are in ongoing discussions with the government about reforms to a range of taxes; reforms that have been deferred for too long. Specifically, we believe the Autumn Budget should:
- Provide clarity on how business taxation is expected to evolve over the next five to 10 years, including when changes are expected and the objectives for reform.
- Improve certainty of employment status for tax to mitigate a barrier to business growth.
- Review capital allowances and simplify the venture capital trust tax regimes.
- Set out plans for reform of business rates by the end of the year.
- Ensure R&D tax relief remains cost-effective and easy to use, especially for SMEs and smaller claimants.
- Commence a comprehensive review of VAT.
- Review reporting burdens on employers.
- Review the impact of proposed reforms to the tax rules for carried interest and non-UK domiciled individuals to assess the impact on growth and investment.
- Reduce the administrative burden and cost to business of the planned rules for MTD ITSA by removing quarterly reporting requirements.
- Provide further investment in HMRC to improve customer service levels and resources to help improve compliance, particularly among small businesses.
Action early in this parliament to commit to reform could yield dividends for the long-term prospects for the economy.
We’ve also called on the government to fix its underlying debt measure to allow for an increase in the investment the UK needs for growth, as part of a long-term fiscal strategy that puts the public finances on a sustainable footing.
Our members run many of the world’s companies. For example, 84% of the FTSE 100 has an ICAEW member on the Board, and 99 of the top 100 brands in the world have our members involved in their success. And when not running the business, it is our members that are advising them – from giant enterprises to the one-person sole trader – so ICAEW, through its members, has a better fix on business, and what is needed to succeed in business, than arguably any other body.
As chartered accountants and business advisers, we stand ready; it’s time to boost growth and build an economy fit for the future. With the right package of measures, Britain can be the best place in the world to invest, and to start, run and grow a business, and I know that message came through loud and clear from our members at our conference.
You can view ICAEW’s full Budget submission here.