• Sat. Apr 20th, 2024

North East Connected

Hopping Across The North East From Hub To Hub

Budget reactionL-R: Karl Pemberton, Ben Quaintrell, and Bob Borthwick

Business leaders in the North East have had a mixed reaction to Chancellor Jeremy Hunt’s Spring Budget, the last one ahead of a general election expected to be held later this year.

Karl Pemberton, managing director of Thornaby-based Active Chartered Financial Planners, said: “The Chancellor offered some positives measures in the Budget such as in confirming pension changes and reducing the tax burden on working people.

“His introduction of an additional ISA allowance for British investment is welcome recognition that there are significant challenges, but it may be a drop in the ocean compared to the changes needed to deliver sustained growth.”

Ben Quaintrell, the founder and managing director of estate agency group My Property Box, which has offices in Darlington and Newcastle, said: “The reduction on Capital Gains tax on property from 28% to 24% will benefit those seeking to upsize, generating some increased market activity. However, it may also encourage some landlords to sell up, shrinking the private rental sector at a time when demand is outstripping supply.

“The Chancellor also announced  the scrapping of tax relief on furnished holiday lets which may deter investors operating in this sector, while potentially increasing the number of homes available for long-term lets in areas where property is traditionally in short supply.

“The Spring Budget has missed an opportunity to stabilise the housing market and improve homebuyers’ prospects by avoiding long-awaited measures including stamp duty reform, a proposed 99% mortgage scheme, together with a concerted effort to prioritise the expansion of the nation’s housing stock.

“However, I am heartened by predictions that the interest rate is set to fall below 2% within months and the economy is expected to grow by 0.8% this year and 1.9% next year  – creating a more stable and positive environment for business.”

Bob Borthwick, a director of Teesside-based recycling experts Scott Bros, said: “The main encouragement is that inflation is expected to fall below 2% over the next two months which, together with individual tax cuts, may translate into more vibrant economic conditions which stimulate demand.

“The Chancellor was severely constrained financially in what he could achieve, so the Spring Budget contained little that is groundbreaking or has not already been announced.

“However, I do welcome the fact that the 5% increase in fuel duty will be frozen for another 12 months, although this does nothing to reduce our current operating costs. I also support the additional £120m investment in green industries, including offshore windfarms and carbon capture and storage, as part of the UK’s transition to a low carbon economy.”