Shake-up of tax gathering on horizon?

AS a wide generalisation, many businesses, whilst always finding something to criticise, will broadly welcome Chancellor Rishi Sunak’s latest Budget. Delivered at Gordon Brown’s rapid speed, it covered a lot of ground in a short period of time.

The hospitality industry should be pleased, for there was some positive assistance for them, although I cannot really see price reductions being passed on as the industry as a whole comes to terms with paying its staff a lot more money.

However, I was particularly interested in the shake-up of assessing tax for alcohol, namely, the stronger the drink, the more tax will be levied. I just wonder if this is a trial run for a much larger shake up of tax gathering just over the horizon. Government, as we all switch to electrically powered vehicles, has got to replace the loss of tax on diesel and petrol. Now I am wondering if Government is quietly looking at road pricing, namely, the more miles we put on the clock, the more tax we pay.

This would actually be a much fairer system, drivers paying for use. The problem will be as to how such statistics are collated and checked, for mileometers can be altered relatively easily.

Also, baffling are the alterations to Airline Passenger Duty. From a “green” perspective, surely internal flights should be discouraged, persuading travellers to use electrically powered trains. After all, Mr Sunak is increasing rates for very long-haul travellers.

I have always been very suspicious of projected forecasts as so clearly demonstrated by the OBR, who six months ago, forecast an increase in business activity of 4% for 2022, but now suggest that 6.5% is the correct figure. This is in line with a government forecast around the same time that inflation would peak at 3.9% in December, then fall back to 2%, whereas now, they are suggesting that it will be 4% throughout the coming year. I think that this is still wrong, for looking at the price increases crossing my desk, I believe that it will be closer to 7.5% at its peak. In conclusion, I was very impressed with the way that Ed Miliband and Rachael Reeves stepped in at just 20 minutes’ notice to front the Opposition due to Sir Keir testing Covid positive. No mean feat!