Budget: Tech Sector Warns Capital Gains Hikes Devastating

With the Budget just eight days away, eyes will be on how the Chancellor plans to cover the government’s astronomical coronavirus bill and build economic confidence after the pandemic. As Guido said last week, every policy in the Chancellor’s red box should aim to do one thing: create jobs…

The reports that Sunak is mulling a significant hike to Capital Gains Tax (CGT) won’t do that. The Treasury has mooted plans to raise CGT into alignment with Income Tax several times throughout the last year, yet as research by Beauhurst (a data company that tracks ambitious UK companies) shows, such proposals risk serious damage to job security and angel investment:

“To be frank, the results are far more concerning than even we anticipated. They show the potential for a large and rapid loss of UK jobs through a combination of reduced business investment and an exodus of companies to more favourable jurisdictions.

Up to 85% of companies representing almost 90% of jobs in the sector would actively consider moving abroad if the changes come into effect. In a world where remote working means that physical location is less important than ever, that can’t be seen as an empty threat.”

The UK’s growing tech economy is a huge boon for jobs across the country, and raising Capital Gains Tax would jeopardise that growth at a time when it’s all the Chancellor should be focused on – you can’t tax your way out of a recession, even Keir Starmer seems to have learned that…

mdi-tag-outline Beauhurst Budget Tax
mdi-account-multiple-outline Rishi Sunak
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