Entrepreneurs will be left disappointed after Chancellor Alistair Darling today confirmed plans to abolish taper relief as he delivered his first Budget to the House of Commons.
The new capital gains tax (CGT) rules will allow a
10% tax rate for up to the first £1m of lifetime capital gains, and entrepreneurs and investors would be able to claim relief for gains made on multiple occasions up to a cumulative total of £1m.
During his Budget speech Darling said: “
This Budget continues a programme of tax simplification. I am today announcing further steps to help small companies simplify their tax calculations.”
Darling insisted 90% of entrepreneurs would still be eligible for the 10% rate of tax on the sale of business assets.
However, when the new measures were first revealed earlier this year, many entrepreneurs voiced their displeasure at the news. Duncan Cheatle, founder of entrepreneurs’ network the Supper Club, told Crimson Business the decision was a ‘complete disaster and a slap in the face for the real entrepreneurs’.
At the time he also added: “
It’s essentially a retirement reward for those with no aspiration to drive the economy and create jobs. Those looking to grow fast and already pay loads of tax now have no incentive to go and do it again.”
Darling today also confirmed that the proposed new rules on non-doms – which includes levying a one-off charge of £30,000 after seven years – will be implemented in April.
Kevin Nicholson, head of entrepreneurs and private companies at consultancy firm PricewaterhouseCoopers said the "failure to delay on the implementation of the non-dom rules is disappointing,"
“We will not know the full impact of these changes for some time but they will undoubtedly reduce the attractiveness and competitiveness of the UK for this important group of wealth creators," he continued.
© Crimson Business Ltd. 2008
