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Abolish stamp duty: six wealth managers' Budget wish lists

Reduced stamp duty, better financial incentives, no change to pensions, our readers have a laundry list for the chancellor.

Phillip Hammond has some tough decisions to make in this year's Budget.

We asked six wealth managers to offer some advice to the chancellor ahead of his statement to the House of Commons tomorrow...

 

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Phillip Hammond has some tough decisions to make in this year's Budget.

We asked six wealth managers to offer some advice to the chancellor ahead of his statement to the House of Commons tomorrow...

 

Leave a comment!

Please sign in or register to comment. It is free to register and only takes a minute or two.

Paul McGinnis

Analyst, Shore Capital, Liverpool

‘While the strong temptation would be to suggest no further changes to pensions, there remains a large inconsistency. The fact that there is a limit on both contributions but also on the ultimate size of the fund (in the form of the lifetime allowance) effectively penalises successful investment.

‘To compound this inconsistency, the government has progressively reduced the lifetime allowance during a period in which it has actually required an ever larger pension pot to generate the same level of pension income due to plunging annuity rates.

‘If a cap is to remain on contributions, either with or without tax relief, then we would advocate the abolition of the lifetime allowance to
allow individuals the opportunity to invest at a level that is capable of providing a pension that doesn’t represent a potentially large drop in income post-retirement.’

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Oliver Pearson-Lund

Chief investment officer, Peregrine & Black IM, London

‘My wish list for the Budget includes a reduction in stamp duty on house purchases, which is having a detrimental impact on the housing market in the South East.

‘In the area of environmental social governance and impact investing, I would like to see much more done by the government in terms of carrot and stick tax incentives to encourage firms to cut waste, improve recycling and engineer new more environmentally friendly ways to package products.

‘Lastly, I would also like to see tax incentives to encourage new business. It has been muted that the chancellor may delay cuts to National Insurance contributions for the self-employed. I think this would be a grave mistake and sends the wrong message. I know first-hand the huge costs that go into creating a new enterprise and especially with uncertainties regarding the UK’s withdrawal from the European Union, I would like to see further tax incentives to encourage investment in new enterprises.’ 

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Lisa Mcleod

Investment manager, Redmaye Bentley, Grampian 

‘It is likely the pension age will continue to be pushed out due to the UK’s ageing population and low economic growth. I hope the chancellor will address the weak household savings ratio by providing additional incentives to encourage individuals to save and invest more for the future.

‘Further increases to the annual Isa and Jisa allowances, reductions to capital gains tax and stamp duty, along with maintaining the current dividend allowance, would all be welcomed. There should be more focus on providing the next generation with better financial education; perhaps financial services firms should be more involved in providing support.

‘I feel that adequate education from an early age is key to tackling the financial health of the nation, both from a business and personal perspective.’

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Shabir Chowdhary

Managing partner, RYSE Asset Management, London

‘Plenty of government grants exist to support SMEs, however being eligible for them is a substantial challenge. To secure London’s future as Europe’s leading tech hub, the autumn budget in our opinion should provide increased support for SMEs via a combination of increased grant funding, cheaper financing and lower hurdles to both.

‘It should include measures to provide or encourage fiscal incentives to further encourage and support the growth of innovation centres across London to include accelerator and incubator platforms that seek to invest in human capital, provide mentoring and business support assistance to entrepreneurs and access to infrastructure, such as discounted office space, and support scale up opportunities.

‘We also believe the Stamp Duty Land Tax (SDLT) is a significant deterrent to home movers, putting major pressure on the UK housing market. A reduction in SDLT should be seriously considered to assist in sustaining some level of continued activity at the higher level into 2018 and beyond.’

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James Calder

Research director, City Asset Management, London

‘Far be it from me to tell the chancellor what to do as having financial services experience I do not fulfil the requirements to be chancellor. However, in keeping with the spirit of the question, my wish list would be topped by two bold new policies; the first would be to abolish stamp duty.

‘UK Stamp duty was first introduced in 1694 and was levied to pay for the war with France, which I do hope we have paid for by now. Stamp duty has moved on since then in terms of what it is applied to, but the principle remains the same. In my view, the freeing up of spendable income would boost the economy more than the loss of a trivial contributor to the budgetary purse.

‘My second bold policy would be to leave pensions well alone, a simple concept but possibly hard for this chancellor to put into practice.’ 

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George Houston

Senior technical and development manager, Mattioli Woods, Glasgow

‘I guess that because the briefing/rumours have been so plentiful in the run up to the Budget, my wish would be that it isn’t as impactful as I fear it might be.

‘If the Chancellor is going to make changes to tax privileged investments such as EIS, VCT and AIM portfolios, I do hope that this will be done in a joined up way and that any changes that do emerge still afford clients the opportunity to invest in these areas to legitimately mitigate their taxes.

‘The subject of pensions tax relief remains a bit of a hot potato – I think there is an acceptance that change is needed - and inevitable - but this is a complex area and any changes would need a long lead-in time to allow for system alterations to be made.

‘Last Budget, I wished for some simplification to be applied to the operation of the MPAA – it’s still on my wish list this time around.’

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