Budget 2010: take 2 (IT, Co-ops and Community edition)

I’ve been watching the June budget and pondering its effects on me, our co-op, co-ops in general and the wider community.

IT Taxes
I just want to flag this one up as a special interest: the telephone tax is killed off before it starts. Yippee! But now we get to wait and see how “the government will support private investment” to get universal provision of fast broadband. I’ve no problem with tax relief for the video games industry being scrapped – why should any type of software get special treatment?
VAT up 2.5% to 20% from 4 January 2011
This seems bad for everyone. It’s a bit less bad for our co-op because we have some international suppliers, whose sales tax rates won’t change, but we buy a lot from the UK too and it hurts all our workers.
Personal Taxes
The basic income tax allowance rise of £1,000 is welcome, as is restoring the pension-earnings links. More widely, the freezes in various things, increase in Capital Gains Tax and drop in cider tax all seem broadly good ideas. The housing benefit £400 maximum is a bit mixed – how bad it is may depend how lenders react when borrowers get into difficulty.
Business Taxes
At a time when a VAT increase is called “unavoidable”, it stinks a bit to cut corporation tax, extend the 10% capital gains tax allowance and raise the employers’ National Insurance threshold. Of course, our co-op pays none of those, so it also hurts us by giving our competitors an advantage.
Business Incentives
George Osborne said he wants to tackle regional economic differences, but the big change in this budget is bad for all existing businesses outside London, the South-East and East: National Insurance exemptions for new businesses. Once again, existing co-ops take it in the neck from another government obsessed with capitalism and employment instead of businesses and work. Meanwhile, increasing the Enterprise Finance Guarantee props up debt-laden business and a new Growth Capital Fund encourages capitalist businesses, while both appear useless to good co-ops at first glance. I don’t mind being ignored, but could we please elect a government which doesn’t actively hinder co-ops? Where’s the fabled “commitment to fairness”? Promises around the Green Investment Bank and Green Deal sound good, but are in the future.
Council Tax
Council Tax will be frozen for a year. I wonder if that applies to parish councils, because our village planned a cut after a one-year project-based increase last year. The Budget Document has pretty much no detail.

So, how was it for you? Have I missed some friendly changes?

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