Millionaire Tory donor Howard Shore warns Rishi Sunak not to hit entrepreneurs and pensions with tax hikes in the Budget saying the UK did not undo EU ‘shackles’ only to make firms wear ‘fiscal handcuffs’
- Shore urged Chancellor not to slice into rate relief for entrepreneurs and pensions and avoid increasing inheritance tax in March 11 Budget
- Instead he suggested that he take advantage of low interest rates to borrow
- Boris Johnson plans to boost the UK’s infrastructure via spending boost
Howard Shore, pictured, urged new Chancellor Rishi Sunak not to slice into rate relief for entrepreneurs and pensions and avoid increasing inheritance tax when he delivers his Budget on March 11
The Tories should avoid ‘egregious’ tax rises in the budget that could damage ‘fragile’ investor confidence, a millionaire hedge fund boss and heavyweight party donor warned today.
Howard Shore urged new Chancellor Rishi Sunak not to slice into rate relief for entrepreneurs and pensions and avoid increasing inheritance tax when he delivers his Budget on March 11.
Instead the Shore Capital Group and Puma Brandenburg founder suggested that he take advantage of low interest rates to borrow to finance Boris Johnson’s plans to boost the UK’s infrastructure.
In a column in the Financial Times, Mr Shore wrote: ‘Investor confidence can be fragile.
‘It could easily be lost were there to be egregious tax rises in this month’s Budget.
‘A proposal to abolish entrepreneurs’ relief risks signalling that risk taking isn’t being encouraged.
‘Cutting pension relief risks discouraging saving for old age, at the very point when the government is rightly coming up with a plan for social care in an ageing society.
‘And talk of expanding inheritance tax is a huge political gamble for relatively little additional revenue. This tax is unpopular for a reason — it undermines aspiration. The people who generate jobs and prosperity in the UK are already taxed very highly, so further tax rises would send out completely the wrong message.
‘It would suggest that Britain is not open for business; that the country has left the shackles of the EU only to impose fiscal handcuffs on enterprise.’
In a column in the Financial Times, Mr Shore wrote: ‘Investor confidence can be fragile. It could easily be lost were there to be egregious tax rises in this month’s Budget.
Instead the Shore Capital Group and Puma Brandenburg founder suggested Mr Sunak (pictured) take advantage of low interest rates to borrow to finance Boris Johnson’s plans to boost the UK’s infrastructure.
Mr Sunak is planning to mount a £3 billion tax raid in this month’s Budget by targeting entrepreneurs.
The plan to abolish entrepreneurs’ relief is part of a ‘tax and spend’ statement which is likely to cause unease among the more fiscally hawkish Tory backbenchers.
They have already signalled that they will rebel against any measures in the Budget which single out higher earners.
Lobbying by the backbenchers has already forced the Treasury to ditch plans to cut pension tax relief from 40 to 20 per cent for high earners, while the possibility of a mansion tax on expensive homes was strangled at birth in Downing Street amid fury from MPs.
A number of Tories have also indicated they will rebel if the Budget is used to raise fuel duty.
But the Treasury is determined to press ahead in the March 11 Budget with plans to abolish entrepreneurs’ relief, which taxes people who sell their businesses at a reduced rate of 10 per cent up to a threshold of £10 million.
The Resolution Foundation called it ‘the UK’s worst tax break’, and argued that scrapping the ‘expensive, regressive and ineffective’ tax would generate £2.7 billion that could be spent on the public sector.
Mr Sunak’s team have also been canvassing business reaction to introducing a range of new green taxes as part of a drive to tackle climate change.
The Chancellor needs to tap into new revenue streams to fund Boris Johnson’s ambitious programme of big-ticket spending plans, including an investment splurge on the NHS, HS2, and even a bridge between Scotland and Northern Ireland.
But despite the Prime Minister’s 80-seat majority, No 10 has been alarmed by the level of disquiet on the Tory backbenches: in the coming days alone, they are expecting pushback in the Commons from Tory MPs opposed to HS2 and the decision to allow the Chinese giant Huawei to help build the UK’s 5G telecoms network.