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A .C .MOL E & SONS

CHARTERED ACCOUNTANTS

pro

ac

tive

S P R I N G 2 0 1 7

There will be a second Budget later in the

year in which further tax measures can be

expected.

The Office for Budget Responsibility (OBR)

has revised its growth predictions to 1.8%

for 2016, 2.0% in 2017, and 1.6% in 2018

before rising to 1.7% in 2019 and 1.9% in

2020. There remains significant uncertainty

over the likely impact of Brexit.

CPI inflation was 0.7% in 2016 and is

forecast to rise to 2.4% in 2017 and then to

fall back to 2.3% in 2018 before stabilising

at 2%.

The deficit – the amount by which the

government’s annual expenditure exceeds

its income – is now expected to be £51.7

billion for 2016/17, £58.3 billion in 2017/18,

£40.8 billion in 2018/19 and £21.4 billion in

2019/20. Deficits are also forecast for

2020/21 and 2021/22 of £20.6 billion and

£16.8 billion.

These borrowing figures are lower than

forecast in last year’s Autumn Statement,

but significantly higher than predicted at the

time of the 2016 Budget.

Philip Hammond delivered his

first Budget on 8 March 2017

In the news

We received extensive press coverage of our

Budget predictions and analysis, including

three interviews with tax partner Paul Aplin on

BBC Radio Somerset, BBC Radio Devon and

quotes in the Financial Times and Somerset

County Gazette. Associate Rob Selley has

also been quoted in Farmer’s Weekly and

elsewhere in the farming press on the impact

Making Tax Digital will have on the farming

community.

You can follow Paul and Rob on Twitter for

their latest thinking on tax and farming issues:

@PaulAplinOnTax

@RobAtACMole

Cyber safe

Cyber security is one of the most important

topics we find ourselves discussing with

clients at present.

In the last edition of Proactive we highlighted

the importance of using strong passwords and

of changing them periodically. In February we

co-hosted a cyber security event in Taunton

with a Bank of England IT security specialist

who reinforced the importance of password

security.

Most security breaches are down to human

error and poor password security rather than

IT failings.

With the advent of HMRC’s Making Tax Digital

(MTD) programme (on which there is an

update on page three) this will become an ever

more important issue. Aside from the MTD

project, we are seeing more and more clients

opting to use cloud based software and apps

to keep their business records and to give

access to up to date information for increased

efficiency and control.

You can find more on cyber security at www.

icaew.com/en/technical/information-

technology at

www.getsafeonline.org

and at

www.cyberstreetwise.com

.

If you would like to explore the potential

offered by apps and cloud based software,

please contact Lexi Shore or Charles Chandler

who head our Business Solutions team. They

can be contacted on 01823 624450 or

ashore@acmole.co.uk

or cchandler@acmole.

co.uk.

Our dedicated Business Solutions

website is at www.acmolebusinesssolutions.

co.uk/.

No date has been set for achieving a

surplus, though the Chancellor still aspires

to return the public finances to surplus “as

soon as possible in the next Parliament”.

The Budget Red Book again highlights the

UK’s relatively poor productivity, which

remains well below the average for the G7.

This has been a persistent problem in recent

years and one that the government is aiming

to tackle through various initiatives including

the new “T Level” exams to boost skills.

The national debt is now forecast to reach

£1,725 billion this year and to hit £1,952

billion – just short of £2 trillion – in 2021/22.

Against this economic background the

Chancellor had very little room for

manoeuvre. The measures he set out are

described on pages two and three.

The greatest uncertainty facing the

Chancellor and the UK economy is

undoubtedly Brexit. On page four we look at

how this may affect the farming community.

BUDGET 2017