Accountants Reaction to Snap General Election
Accountants have been quick to react to Theresa May’s call for a snap General Election. This post covers five aspects of the economy that could be affected.
1. Making Tax Digital
The progress towards MTD has already suffered a number of setbacks and tax professionals say the election will only cause further delays. For example, a number of regulations due to come before parliament have been shelved until after the election. The Treasury Select Committee has called off further meetings scheduled to take evidence from a range of businesses. Some accountants say the election is a good reason to scrap MTD altogether while others are of the opinion that its long term future is dependent on who wins the election. Labour leader Jeremy Corbyn states that, if elected, he will pare down MTD and consider scrapping it altogether.
The Chancellor has said the next Budget will be in November 2017, however there is no guarantee that he will retain his post even if the Conservative party win. A number of accountants think that if a different person is appointed as Chancellor, an emergency budget may be called soon after the election.
3. Finance Bill
The finance bill was going through its second reading when the snap election was announced. The Bill is so complex that it seemed unlikely to be complete before parliament rose. Opinions are divided as to whether the Bill will be reduced to a few clauses to meet the deadline or put on ice until after the election.
4. Tax Locks
This topic has sparked a lot of activity on social media. The Labour Party has pledged to retain the triple lock, whereas the Conservative Party’s position is still unknown. Comments query whether tax locks will be mentioned in the Conservative’s manifesto or whether the election will be an opportunity for them to abandon the pension lock.
Opinions are divided about how exports may be affected by this election. The decision regarding whether a hard or a soft Brexit option is taken will depend on who wins. A Conservative win will strengthen negotiations with the EU. Alternatively, a win by an opposition party may result in the referendum debate being re-opened.
Tax professionals are using the election announcement as an opportunity to air their concerns about the economy and predict the potential outcomes.