Brown gives IT firms and small business more tax breaks
And it's all thanks to mobile phones
Pre-Budget report Chancellor Gordon Brown has delivered his pre-Budget report and silenced the endless commentary on how he will split up the government cash between public services and tax credits aimed at removing poverty and encouraging business.
The answer is: he will give huge amounts of money to both. Well, what did you expect? Who knows how the figures will break down in reality, and no doubt there will be a lot of coverage tomorrow on his decisions regarding the NHS and pensions.
However, with regard to The Register's area of interest, there was an overwhelming sense of déjà vu. Brown gave almost the exact same speech in March this year.
There is some tinkering with tax credits and rates: a new tax credit for research and development to "boost innovation". To encourage entrepreneurship capital gains tax on business assets will be reduced to 20 per cent for those held over one year and 10 per cent for over two years.
The share option scheme for small business will be extended - how or by how much we don't know at the moment, but Mr Brown reckons this is worth £30 million. Also for small business, the threshold for 10p corporation tax for increased and a new flat-rate VAT scheme will cut back on red tape and save a company, on average, £1,000 a year, he said.
The chancellor went on for ages about how he had cut back national debt and how the reduction was worth £1 billion a year to the UK (we'll ignore the fact that he then went on to spend this £1 billion about ten times over).
In 1997, debt was 54 per cent of our national income; now it's just 31 per cent (compared to 40 per cent for the US and Germany). He planned to pay back £34 billion this year but thanks to "tough fiscal rules" this has been increased to £37 billion.
He was more candid this time about where this huge sum of money came from (we normally pay back about £9 billion a year). He admitted: "Instead of using the £22 billion from mobile phone licences on current spending we used it to pay off national debt and have achieved a permanent saving..." etc. etc.
It's an indication of how little new was in the speech that the chancellor can give the same speech eight months later. Even the abolition of football pools tax was done last time with the abolition of gaming tax. Not that that is a bad thing.
Oh, and Mr Brown said that he had waved the green flag on the review over whether the UK fits in with his famous five economic tests to join the euro. ®