2017 Spring Budget - key tourism points
Published: 09 Mar 2017
Chancellor Phillip Hammond delivered his Spring Budget yesterday.
The Chancellor offered support for businesses suffering from increased business rates and promised that there would be a consultation on calculating business rates before the next revision in 2022.
However, as many tourism businesses are owner-operated SMEs, there are changes to tax treatments for National Insurance Contributions and the tax treatment of allowances that will impact many tourism businesses.
Below is summary of the key issues that will affect tourism businesses - the full details can be read in the Tourism Alliance briefing here.
- Reform valuation process - a consultation will be held before the next revaluation in 2022
- Cap on any business coming out of small business rate relieve, to a maximum of £50
- Pubs with a rateable value of up to £100,000 will get a £1000 rebate, estimated at 90% of pubs
- £300 million fund for local councils to offer discretionary relief for hard-hit cases
Infrastructure and Transport
- A £690 million competitive fund to be set up for local authorities to tackle congestion
- Allocations of £93 million for the North and £23 million for the Midlands from a £220 million fund that address pinch-points on the national road network
- The Government will publish a consultation with proposals to bring the tax treatment of employer-provided accommodation and board & lodgings up to date. This will include proposals for when accommodation should be exempt from tax and to support taxpayers during any transition.
- From 13 March 2017, the duty rates on beer, cider, wine and spirits will increase by RPI inflation
- From 1 April 2017 the VAT registration threshold will increase from £83,000 to £85,000 and the deregistration threshold from £81,000 to £83,000
- The Government will publish a call for evidence on exemptions and valuation methodology for the income tax and employer NICs treatment of benefits in kind
- The Government will publish a call for evidence to better understand the use of the income tax relief for employees' expenses, including those that re not reimbursed by their employer
- The director-shareholder allowance to be reduced from £5,000 to £2,000 from 1 April 2018
- NI contributions will rise for the self-employed to 10% from April 2018, and again to 11% in 2019
- The Government will make administrative changes to the Research and Development Expenditure Credit to increase the certainty and simplicity around claims, and will take action to improve awareness of R&D tax credits among SMEs
- Following consultation, the Government will increase the cash basis entry threshold to £150,000, and exit threshold to £300,000. The use of cash basis will be extended to unincorporated landlords
- To celebrate the 400th anniversary of the sailing of the Mayflower, a Government Representative for Mayflower Anniversary Celebrations to assist in coordinating UK-wide events
- The Government will consult on proposals to redesign rent-a-room relief, to ensure it is better targeted to support longer-term lettings in order to increase supply of affordable long-term lodgings
Air Passenger Duty
- APD rates for 2018-19 will increase in line with RPI. Rates for 2019-20 will be set at the Autumn Budget 2017
- The Government has agreed a Memorandum of Understanding on further devolution to London and is in discussions in Greater Manchester on future transport funding
- Progress continues on city deals for Edinburgh and Swansea
- New T-Levels will replace 13,000 qualifications with just 15. The number of hours of training for 16-19 year old technical students will increase by 50%. The new qualifications will include a high-quality 3-month work placement for every student