UK Budget Preview - The Chancellor must encourage enterprise

Ahead of the UK’s 2013/14 financial budget we ask Alpesh Patel, financial author, trader and media commentator, for his thoughts on what Chancellor George Osborne should be announcing on Wednesday.

For me the two key elements the Chancellor should do:

1. Encourage corporate investment through matched funding

a.  The Government is keen not to spend and see the budget spiral unless it can be shown it is investment spending.

b.   We know corporates are hoarding cash. Taxing them is not an efficient way to extract their monies. And only encourages tax avoidance.

c.   The Government cannot encourage the banks to lend – it’s tried that – doesn’t work.

d.   Clearly matched funding, where the Government would match monies risked by business, (gbp5m+ deals – so not too tiny), would loosen business purse strings and leverage money that is in the system and ensure the government does not spend it on Microsoft data for NHS projects which go nowhere.

2. Bank Bonuses to be commensurate with tax in UK bank pays

 a. It’s a simple rule. The bonus of any banking executive can only be 0.1% of all tax revenues the company pays in the UK. If you don’t pay tax in UK, you don’t get bonus in UK for UK work.

Alpesh Patel

www.alpeshpatel.com

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