Fiscal Policy & Economic Backdrop
Winter 2020

The first budget since 2018 will be delivered by Sajid Javid on March 11th. The budget pledges to “unleash Britain’s potential [and] usher a decade of renewal” with a greater regional spread of investment. We may also see the introduction of an additional Stamp Duty Land Tax surcharge for non-UK resident purchasers, both individuals and companies. Such a charge could mean a top SDLT rate of 18%, rather than the current 15% for some non-resident buyers, on a purchase price that exceeds £1.5 million.

New rules on Captial Gains Tax also come into force from April 2020; individuals and trustees disposing of residential property will be required to make their tax payment on account within 30 days of sale completion.

UK inflation fell to its lowest level in over three years in December, fuelling speculation that the Bank of England may well cut interest rates in the near future. At 1.3%, the Consumer Price Index is significantly lower than the Bank’s 2% target. Despite predictions that the UK economy will have grown by just 1.3% over the course of 2019, its lowest level since 2009, consumer confidence in the economy over the next 12 months saw a 7 point jump in the GfK consumer confidence tracker in December. The FTSE 250 posted its highest daily rise in a decade following the election result, while the value of Sterling against other global currencies has also risen.