Manufacturing really needs a Budget boost

NEXT Wednesday’s Budget Statement will be the first that Chancellor Phillip Hammond will make and will also be his last spring offering, future Budgets being in the autumn. Mind you, politicians can be fickle, and it would not surprise me to see further timing changes in the future after Brexit.

Of course the Chancellor is being offered copious amounts of advice from pressure groups from all walks of life including the CBI, who are very anxious that business in general is spared further penalties. In point of fact, manufacturing in particular needs encouragement, for post-Brexit, Governments will have to place more reliance on this sector to help balance the books.

For certain the rate of inflation will be higher at the end of this year than now, for prices will have to rise as a direct result of the weakness of the pound, thus it is inevitable that wage demands will also increase as the pound buys less.

Now for Government, this may not be a bad thing, for as remuneration increases, so will tax returns, for it is almost certain that Phillip Hammond will not increase tax thresholds in line with inflation. By way of illustration, Inheritance tax thresholds have remained the same at £325,000 since April 2009 during which time inflation has soared, the average annual increase being 2.11 per cent.

So successive Chancellors have been raking it in, and that is just one tax. So, having regard to the enormous debt mountain that this country has incurred, the likelihood of generous giveaways are remote.

However, I do really hope that one tax might receive favourable treatment, and that is Airline Passenger Duty. This is an iniquitous tax hitting vacationing families and business travellers alike. Government has got to take on board the fact that if we are to be a busy trading nation post Brexit, sales teams have, to use a dreadful American expression, go and “press the flesh”. Valuable contacts have to be made face to face, not via email or skype.

The Scottish Government is to cut APD by 50 per cent next year, and get rid of it as soon as possible.

Russell Luckock is chairman of Birmingham pressings firm

AE Harris