Gordon Brown delivered this year’s Budget speech against a background of military action in Iraq. He set aside £3 billion to meet the costs of this and opted for borrowing rather than tax rises to make the numbers add up. Whilst the Budget was seen to be low key and modest there were a number of measures announced that may bring a smile to your face.Much was made of the new Child Trust Fund or ‘baby bond’. Babies born from last September will receive a government endowment of £250, or £500 for those from lower-income families. The fund can then be added to by family and friends and will be accessible at age 18. The more cynical amongst you may think that the funds can later be used to help pay off student loans!
An extension of the period for which small businesses can claim 100% capital allowances on computer equipment was announced. The allowance was expected to run out on 31 March 2003 but is now available until 31 March 2004.
There is good news on the capital gains tax front as well. The definition of ‘business asset’ for taper relief purposes will be extended in April 2004 so that more investment properties let to traders will qualify.
We can also heave a sigh of relief that, at least for the time being, no further increases were announced in national insurance rates or stamp duty both of which were suggested as possible areas for extra revenue collection.