Alistair Darling's Budget speech on the 24th March was set on a stage ahead of the General Election, in the shadow of the recession and rising fiscal debt and with a steep uphill climb facing the UK economy.
The centrepiece of Alistair Darling's Budget seems to be a £2.5bn package for small and medium-sized business, funded primarily by better than expected receipts from the one-off tax on bankers' bonuses.
Although the Chancellor's speech lacked headline-grabbing tax changes, the Treasury still managed to produce 71 specific Budget Notes detailing the changes set out across 161 pages.
Despite the absence of further fundamental tax changes, merchants should not forget the deferred changes which will come into effect as of April 2010 (and beyond), which have been introduced by previous Budgets.
According to the post-Budget report issued by PriceWaterhouseCoopers, the 2010 Budget contained a large number of tax and spending initiatives, but most have only a small fiscal impact and, in combination, they were broadly fiscally neutral.
Overall, the initiatives amounted to £1.4bn (0.1% of GDP) of net fiscal loosening in 2010-11, followed by net fiscal tightening of £0.2bn in 2011-12 and £0.7bn in 2012-13.
Changes of this magnitude will have almost no impact on the path of the Government deficit or the growth rate of the economy as a whole, said the report.
PriceWaterhouseCoopers said it expected significant further fiscal tightening through additional tax rises and/or spending cuts will be needed after the General Election, irrespective of its outcome.
Here at Greengates Builders Merchants Accrington, Lancashire we hope that changes will in turn help the economy rebuild.