No nasty surprises in Chancellors statement

By Robert Harris

CHANCELLOR Gordon Browns pre-Budget statement contained few surprises for agriculture.

While there was no new money on the table for farmers or rural businesses, the Chancellor did confirm several earlier announcements which could take shape in next Aprils Budget.

A pesticide tax remains the biggest threat, according to Carlton Collister, senior tax manager at Grant Thornton.

“The Chancellor restated his intent to review the environmental benefits of the current voluntary package on pesticides before the 2002 Budget.”

If he decides that package does not measure up, the new tax could be introduced in April 2003, said Mr Collister.

The statement contained some better news, too.

“The Chancellor confirmed the maximum business asset taper relief for capital gains on individuals will be available after two years ownership, rather than four,” said Mr Collister.

“This means the effective rate of tax for a higher rate taxpayer is reduced to 20% after one years ownership and 10% after two years.”

Changes to tax relief on “intangibles” in companies mean that livestock and milk quotas are now included.

But although inheritance tax, seen by many observers as a soft target, appears to have escaped this time round, increased NHS funding could foreshadow tax rises, says Mr Collister.

Mr Brown also announced a cut in biodiesel duty to 20ppl below ordinary diesel, and further tax incentives for other green initiatives are planned.