UKinbound, Hotel Booking Agents Association and the British Property Federation comment on The Budget 2018…
Following Philip Hammond’s delivery of his third Budget as chancellor, UKinbound, Hotel Booking Agents Association (HBAA) and the British Property Federation have commented on the key points that will affect building infrastructure and tourism in the UK.
UKinbound
UKinbound – the trade association that represents nearly 400 of the UK’s top tourism businesses – has cautiously welcomed some of the new policies and initiatives outlined in the chancellor’s 2018 Budget but urges the Government to re-consider its decision not to change VAT or APD regimes, particularly in Northern Ireland.
New policies that will have a positive effect on the UK’s tourism industry include:
- The opening of e-passport gates to citizens from the USA, Canada, Australia, New Zealand and Japan which will help to reduce queues and waiting times for these visitors.
- Funding to help restore historic high streets and for Coventry to help it prepare for hosting the UK City of Culture in 2021.
- The roll out of full fibre broadband for rural areas, which will help tourism businesses to connect and market their businesses more effectively to visitors.
- Funding to repair and improve roads and extension of the Transforming Cities Fund, which will help to improve connectivity and transport links in cities. This will help to encourage tourists to visit and further explore the UK’s cities, likely resulting in increased economic benefit across the whole of the UK from enhanced visitor spend.
“We are pleased that the Budget includes several policies that will have a positive impact on the UK’s tourism industry,” said Chairman Mark McVay. “These include the welcome introduction of e-gates for more of our international visitors, improvement of transport links in our cities and digital connectivity in rural areas and funding to help restore and sustain our historic high streets.
“However, it is disappointing that there will be no change to APD and VAT regimes at this point, even though there is strong evidence that cutting these taxes will in fact generate more revenue for the Government in the long term.”
HBAA
Louise Goalen, HBAA Chair, comments on on the Chancellor’s Autumn Budget Statement: “While we welcome many of the Chancellor’s initiatives and the benefits they will bring to the UK hospitality and events industry, there is not enough to address the major talent gap we are facing.
“On a more positive note, it’s good to see a reduction in business rates for smaller companies.”
“The changes in the apprenticeship levy are good news and we hope that venues and agencies whose levy has been reduced to 5% will take advantage of this, and take on more trainees under this scheme.”
“UK business events will ultimately benefit from the £30 billion spend on roads and the freeze on fuel duty. However, when it comes to overseas events, a rise in long haul APD is definitely unwelcome, as this will impact the incentive market. On a more positive note, it’s good to see a reduction in business rates for smaller companies as this will help reduce the overheads of some HBAA agency members.
“Let’s hope there is good news in the Chancellor’s ‘red books’ – the important small print that goes with these headline statements.”
The British Property Federation
Melanie Leech, Chief Executive, British Property Federation comments:
Business Rates
It is good to see the Chancellor acknowledge that many small retailers are struggling against powerful headwinds and provide additional relief from business rates. However, Monday’s announcement does not change the fact that at almost 50 per cent, the rate of business rates is simply too high for occupiers of all sorts. It is time to recognise that business rates are unsustainable in their current form and causing untold damage to our economy; time for a fundamental review.
Digital Tax
As the UK economy evolves, so must the tax system – and we welcome that the Government is taking steps to respond to this. However, this is not an alternative to much-needed support for our high streets, which still require urgent support in the form of fundamental business rates reform. They will also require local plans that can drive adaptation, incentives to encourage town centre investment and more flexibility around change of use and we are pleased that the Chancellor recognised this.
“A new tax relief for commercial property owners is a real surprise.”
Structures and Buildings Allowance:
A new tax relief for commercial property owners is a real surprise. This move brings the UK more closely in line with the many other countries that already provide tax relief for the cost of building commercial property, making the UK more attractive to invest in. It makes investing in new and refurbished buildings cheaper from a tax perspective, and is a welcome move.
Town centres and high streets
The announcement of additional investment into a Future High Streets Fund is welcome, and when combining with the proposed planning reform and a High Streets Task Force has real potential to be a game changer for urban centres facing a change in the way that people shop, how they spend their leisure time, and where they want to live.
However, it’s crucial not to forget some of the other knotty issues that property owners have to grapple with. We support the proper use of CVAs to help businesses in genuine distress and are keen that CVAs continue to achieve these objectives. There is, however, increasing frustration about the practice of some recent CVAs. The BPF has called on Government to conduct an independent urgent review of CVAs.
Land value uplift
We welcome the Government’s sensible, measured approach to land value uplift. In a noisy environment with multiple views on land value capture being aired, it is pleasing to see such a considered response providing more certainty for developers and local authorities, and enabling more infrastructure provision for local communities.
The Letwin Review
We welcome Sir Oliver Letwin’s recommendations, and in particular, his focus on the need for a more diverse, multi-tenure approach to large sites. The benefits will be three-fold, both helping to address market absorption rates and deliver properties quicker and help to create more sustainable places home to different demographics, socio-economic backgrounds, fostering a greater sense of community. In addition, adding a tenure such as build to rent to a development site brings with it an investor with a long term interest.
The Review also recognised the skills crisis in which we find ourselves. Time is of the essence, and whilst we applaud the Government’s intention to take a few months to consider the response to the wider Review, this is an area in which we need urgent action to sure that we can hit the 300,000 target.
Main image credit: Pixabay
