by Andrew Mitchell, tax partner at Armstrong Watson, Skipton office

THE Chancellor delivered his last Budget before Brexit takes effect next March with the backdrop set by the Prime Minister’s announcement that “austerity is over”. Mr Hammond would only commit to it “coming to an end”. Both comments probably rank with “Brexit means Brexit” in terms of meaningful insight.

‘Brexit’ as a word was mentioned only a few times but arguably it overhung everything he said and indeed didn’t say.

Only two announcements were specific to the Yorkshire area as “building the Northern Powerhouse” was replaced by “austerity is coming to an end” as a Conservative Chancellor’s favourite catch phrase. There was up to £37m additional funding to support Northern Powerhouse Rail. Sheffield and the West Yorkshire Combined Authority were both shortlisted for a share of a £440m Transforming Cities Fund. Neither of which will provide Yorkshire with the infrastructure stimulus it needs.

He also announced rates support for smaller high street shops, which will hardly stimulate our struggling independent businesses.

The Chancellor knew he had to fund existing commitments including a £20bn increase in NHS funding so not surprisingly the giveaways were generally small, including additional funds to schools for capital equipment and an increase in the Annual Investment Allowance to £1m for capital expenditure by businesses, a welcome move for many businesses in our region.

The biggest cheer was for an accelerated increase in the personal tax allowance to £12,500, effective from April 2019 rather than 2020.

He resisted calls to abolish Capital Gains Entrepreneur’s Relief although he did increase the minimum ownership period to two years, which should not adversely affect most businesses owners.

There were a number of welcome and imaginative initiatives on the infrastructure and technology fronts. He even offered £420m to fill in the country’s potholes!

The media storm of the digital giants’ minimal UK tax bills was countered with the threat of a Digital Services Tax.

But the Chancellor’s pronouncements were far more of the “better times ahead” tendency than “austerity is over”, which clearly only will be when business and consumer confidence says so. He must maintain reserves to deal with the eventuality of a “no deal” Brexit and indicated that such a scenario will take him back to the drawing board.

* For help and advice regarding any tax issue, please give Andrew Mitchell a call on 01756 620021.