Readers offer CGT support

The profession has offered surprising support for the chancellor over the
radical plans to reform capital gains tax (CGT).

The plans see a single rate come in and all previous reliefs dropped, moves
that have caused an outcry among entrepreneurs, who say they are facing an 80%
tax hike.

But just less than half (43%) of those polled on agreed
chancellor Alistair Darling should press ahead with the reforms, agreeing with
the statement: ‘Tax simplicity is important and there will always be losers as a
result of changes.’

Though most said the chancellor should back down, the significant minority in
favour of pressing ahead will be more surprising given the noisy criticism from
business groups.

Government ministers defended the changes again this week. Business secretary
John Hutton, while declining to say what representations about the tax he has
passed on to the Treasury from business, conceded there were strong arguments
being studied by the chancellor.

But he insisted the regime would keep the UK competitive: ‘Instead of keeping
£90 of every gain, the entrepreneur will keep £82. That is an immensely
attractive tax regime.’

A coalition of groups, including the Federation of Small Businesses, the
Institute of Directors, the Confederation of British Industry and the British
Chambers of Commerce, have all attacked the moves.

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