Chancellor Gordon Brown's ninth Budget on 16 March 2005 acknowledged the growth in the self-employedand small business sectors since 1997 but contained few substantial developments for contractors in the UK. There were major announcements regarding regulatory reform, good news for contractors who havelong complained about the sheer volume of regulation. The Government is cutting the number of regulatorybodies and simplifying form-filling for small businesses. If these changes are implemented, this will be good news for UK contractors. The Chancellor emphasised the importance of skills in the moderneconomy, coupled with scholarships for young British entrepreneurs. However, contractors caughtunder IR35 are unable to offset training costs against tax. This is tough since theirlarger competitors benefit from the current tax legislation. The Budget included the announcement of anti-avoidance measures. The Pre-Budget Report's consultation document on small businesstaxation expressed concern at businesses altering their commercialdecision-making for tax purposes, a recent survey of contractors showed that a large number felt had felt obliged to do so. Full consultation has started on the operation of Her Majesty's Revenue and Customs, formed from the merger of theInland Revenue and Customs and Excise. The prospect of a single tax account for small business is positive and the consultation will focus on minimising compliance costs and making it easier for smallbusinesses to understand the new body. The Budget contained proposals to tackle so-called "goldplating" - over-enthusiasm in the incorporation of EU legislation into UK law. Now this will be interesting.
New tax rates and allowances were announced in the Budget. Go Contracting in the UK is available from www.workingandliving.com
