22 June 2010

Make hay while the sums shines

For the last month we have been told just how tough this Budget was going to be, so we should not be too surprised to hear it confirmed that VAT is to rise to 20% in January nor that capital gains tax is going to increase from 18% to 28% for those liable to income tax at the higher and additional rates.

Now I admit to being a ‘half-full’ optimist but even so, I see some real benefits to those of us in KBB-Land in this Budget and not just in the headline news which in itself is more good than bad.

A rush to beat the VAT increase could bring a last minute flurry of KBB activity as 2010 draws to a close and the increase in capital gains tax may bring more ‘investment’ property onto the market too.

But looking further ahead, the reduction in the main rate of corporation tax from 28 per cent to 24 per cent over the course of four financial years from April 2011, the reduction in the small profits rate from 21 per cent to 20 per cent from April 2011, the National Insurance Contributions (NICs) holiday for new businesses which start-up in certain areas of the UK over the next three years, and an increase in the Enterprise Finance Guarantee and the creation of a new Enterprise Capital Fund will all help smaller businesses.

The January 2011 increase in VAT will put the price of almost everything up, making money tighter, and causing the consumer to be ever more cautious when it comes to buying a kitchen, bathroom or bedroom.

Tomorrow’s orders are going to be won by the retailer who can demonstrate that the quality product and level of service they offer is a better value-for-money solution in the long term compared with the apparent ‘special offer’ in the superstore down the road.

I am reliably informed that 80 companies have already enquired about booking stands for kbb London in 2011so they intend to make the most of the opportunities that will come their way next year.

And if you think that is a plug for one of this blog’s sponsors – just you wait and see what my colleague Sam Cande has to say in her next guest spot!

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