If the Government wants to encourage growth and really help people then it needs to take brave decisions and to invest in the country.
The old saying goes: the best time to plant a tree was 30 years ago, the second best time to plant one is today. We need to take action today or we’ll be stuck talking about the lack of growth and the spiralling cost of living crisis next year, the year after and beyond.
So, here are four things I want to see in the Budget on October 28 that could help everyday people like you and me:
Make tax fairer
The personal allowance, the amount you can earn each year before paying any income tax, has been frozen at £12,570 and is set to remain at that level until 2031.
And this policy is starting to cause some real issues. One of those is that from April the state pension will be above this amount, meaning more pensioners are dragged into paying income tax.
Already, we are seeing more pensioners having to keep working or return to work just to make ends meet. It is bonkers to me that this threshold means that someone who is forced to do this, and has paid into the system their whole life, then faces paying more tax.
So, I’d like to see the personal allowance raised. And I’d also like to see an increase to the trading allowance, which is the £1,000 a year you can make from income aside from your main work.
This allowance was introduced in 2017 and has not been increased since. Often used by those with a “side hustle”, raising this allowance would mean more pensioners could make a bit extra without having to hand it back over to the taxman.
How could we fund these increases? A windfall tax on the banks. The country bailed the banks out in 2008 and again during Covid-19 and they’re now back to posting bumper profits and paying out huge bonuses, so it’s time they repaid a bit of what they were given.
Get a grip on petrol prices
Rising petrol and diesel prices are hurting everyone. From families doing the school run to the business owners I speak to who need their vans for work. At some point, we need to look far more seriously at drilling in the North Sea if we are going to stand a chance at importing less energy and keeping prices lower.
In the meantime, people need help. Fuel duty makes up almost 53p of every litre we buy. There’s a temporary 5p cut at the moment, but the Government needs to go a lot further. More help is needed with household energy bills too, or we are going to have an awful lot of people out there who can’t afford to put the heating on this winter.
A windfall tax on the energy companies would help. The Middle East conflict has pushed up prices, but these firms are still making healthy profits and are too quick to pass those increases on to customers.
More help for start-ups
At the Bank of Dave, we get plenty of applications from people wanting to start a small business, and it pains me how many we have to turn down due to the new regulations on affordability.
We manually underwrite loans, which means we review each case rather than relying on a computer to make a decision based on a credit score. That way we can see if there is a way someone can afford the loan; however, the regulations mean that if the potential customer doesn’t tick enough of the regulatory boxes, we’re not allowed to give the loan.
According to the Founders Forum Group, about 29 per cent of start-ups fail because of funding issues.
I’d love to see a Government scheme that underwrites small-business loans across the UK to really help people who want to start their own company. This would help people who might otherwise be out of work, taking pressure off the system, and empower them to change their lives for the better.
A business tax shake-up
Business rates are killing local businesses. This summer, the Federation of Small Businesses wrote to the Treasury urging it to lift the threshold at which buildings become eligible for business rates after the number of companies liable for the tax reached 100,000 for the first time.
The Government has already taken steps to help the hospitality sector with a discount on business rates, but this needs to be extended across the board to have any real effect and it needs to go further. A tax break of a few hundred pounds just doesn’t go far enough in today’s world.