Autumn Statement 2016 – Turning the Budget on its head

The Chancellor surprised everyone by announcing that this was his last Autumn Statement, but before we had time to wonder what had prompted him to hand in his resignation so soon after his appointment, he went on to assure us that the reason was that he was abolishing the Autumn Statement.  As everyone drew breath again, he then announced that the Spring 2017 budget would be the last Spring budget, but that 2017 would also see the first Autumn Budget, and that there would then be a Spring statement in 2018.

Depending on your personality, you might by now be giving a Gallic Shrug and muttering ‘plus ça change…’, or ranting to anyone that will listen about change for the sake of change and the waste of taxpayers’ money.  However, there is a logic.  Since the introduction of the Autumn statement, changes to the tax system have been passing under our bemused gaze along an endless conveyor, rather like dishes in a sushi restaurant. Some legislation has taken effect from the date of the Autumn statement, some from the start of the tax year and still more from the date of Royal Assent to the Finance Act. On top of this, some legislation hastily passed has had to be amended within a couple of years to rectify unintended consequences.

If the new system works as it is meant to, we will have a budget in the Autumn time which will set out proposals for legislation that can be properly discussed, reviewed and even drafted in time to apply to the new tax year starting the following April. The function of the Spring statement, Mr Hammond has assured us, will be to respond to the forecast from the Office for Budget Responsibility. He did emphasize that if urgent changes were required, this was not being ruled out….but you can’t have everything.