Budget 2003: no change is good news

The Budget should serve as a boost to the construction industry in several ways, promising fast-track planning applications in the poorest parts of the country, boosts for housing, cuts in bureaucracy and attempts to address the skills shortage.

The Treasury will call in a Confederation of British Industry expert to advise on how housing supply can be increased in the UK. Stamp duty on homes and business properties has been frozen.

The R&D tax credit scheme is to be expanded, while the turnover threshold for definition as a small or medium-sized business has been raised to £20m. More small firms will benefit from fines for the late payment of VAT being abolished.

The Climate Levy and Aggregates Levy are frozen at their current rates, while the fuel duty increase of 1.3p per litre has been deferred until October. VED rates on trucks have been frozen.

With regards to skills shortages, the highly skilled migrant programe will be expanded, while job centres will be empowered to draw up their own plans for full employment in their areas. Discussions will be held into the possibility of a minimum wage for 16/17 year olds.

Contractors with track records in office relocation and fit-out could benefit from the Chancellor's decision to move more of the civil service out of London. Every government department must submit plans to the Chancellor on how they plan to move their offices away from the capital.

More construction staff will be seconded to government to take forward the review of deregulatory measures. The Chancellor also confirmed his intention to reform the CIS tax in April 2005, "to reduce the regulatory burden on businesses".

However the Chancellor once again failed to heed the industry's calls for a reduction in VAT to 5% on domestic repair, maintenance and improvement.

* Did the Budget confuse you? Don't know your taper relief from your Climate Change Levy? Then worry no more: Contract Journal has teamed up with Grant Thornton to make available its Tax Facts to www.contractjournal.com users.

This comprehensive document lists the major UK tax rates for the financial year 2003/04. Use the hyperlink below to go straight to a PDF of Tax Facts.

http://www.grant-thornton.co.uk/pages/PublicationsandSeminars/publications/taxfacts_cj.html