3 comments

Charles Clarke on capital gains tax

by Catherine Woods - Thursday, 18th October 2007

Speaking at the Forum of Private Business small firms’ summit yesterday, Clarke said: “Make the argument as clear and as strong as you can.”

He told the gathering to define why this specific tax tweak is so damaging, as distinct from the more general tax creep of recent years, and claimed that the chancellor will “carefully consider” what he hears.

Clarke also spoke about the supplementary business rate, which is being introduced to help local authorities fund economic development.

He admitted that many local businesses think it’s a rubbish move but said he is “less hostile” towards it.

“I think the case is to develop a strong relationship between business and the local authority.”

It was interesting to hear Clarke defend the supplementary business rate but not the contentious capital gains tax proposals. Perhaps he’s protecting his political hide or maybe just flexing his muscle against the new world order in the Labour party.

But could it also mark the beginning of a Labour party backlash against Alistair Darling’s plans for capital gains tax?

One thing’s for sure: the campaign against the proposed changes is gaining momentum, and there were plenty of people in the room yesterday who believe the debate is not going to drop as the temperatures do this winter.

Tags: supplementary business rate, local businesses, capital gains tax, labour party backlash, charles clarke, alistair darling, tax proposals, forum of private business, pre-budget report,

3 Comments

October 23, 2007 10:09pm
Harry Clarke Says:

I completely agree with the point about the unintended consequence of kick-starting an interest in tax avoidance. As a direct response to Mr Darling's moves I have made it a new priority (having never really given it much thought before)and have set-to with a vengance. What fun! I have already come up with a saving of £8000 per annum going forward with the assistance of a tax adviser. Take some time off from making money through your business for the economy and start now!

October 22, 2007 12:52pm
Roger Butterworth Says:

The change to CGT rules is a very negative step, it will lead to consideraly incresed tax avoidance which will both increase tax collection costs and reduce tax revenue - a double whammy that will as a result generate much less nett revenue for the exchequer than the current 'fair' tax level. I for one am looking into ways to avoid my own CGT liability as i type - it seems as simple as going to live somewhare hot like Dubai or Monaco for a few months. Alistair Darling must be bonkers.

October 22, 2007 12:42pm
Michael Lewis Says:

Having bought my parents out of the family business in 1991 (they have'nt heard of the word 'inheritance'!!)I have spent the last two years carefully grooming my business for sale. Some of the proceeds from the sale I planned to re-invest in a new business operated by key members of my existing staff. However the decision to abolish the 10% taper relief and do away with indexation will cost me personally (as opposed to the company) many, many hundreds of thousands of pounds thus negating the capital I had planned to re-invest in the new business. I am devastated that so much money from the sale will go in tax and thereby cancel the opportunity to re-invest. Please make the Chancellor see sense!

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