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Spring Budget 2023 â€”key announcements for Tax practitioners

The Chancellor of the Exchequer, Jeremy Hunt, delivered the government’s Spring Budget on Wednesday 15 March 2023.

Following the turmoil of 2022 and the continued cost of living crisis, the government’s hope is that Spring Budget 2023 will provide stability and encourage growth by making the UK an attractive place to do business and by incentivising employment. While many of the tax-related announcements were pre-trailed, there were some genuine surprises such as the total abolition of (rather than just increasing) the pensions lifetime allowance and the introduction of full expensing capital allowances for main rate assets for three years starting from 1 April 2023. Beyond these headline-grabbing announcements, Spring Budget 2023 also:

• confirmed the Chancellor’s resolve to continue with the 1 April 2023 increase to 25% in the main rate of corporation tax (ignoring calls from some members of the Conservative party to reverse or at least reduce the increase)
• mentioned various closed consultations to confirm either that the government has decided not to make any changes (for example, the  on the proposed reform of the UK’s policy on sovereign immunity from direct tax) or that it is still considering responses to certain consultations and will publish its response in the coming months (for example, the  on reform of the VAT treatment of fund management)
• resurrected the introduction of new investment zones (which, for a period, will benefit from the same tax reliefs as apply to freeports), which were first proposed in the ill-fated  but not discussed at all in the October 2022 
• highlighted areas where the government is exploring the possibility of simplifying tax rules or HMRC guidance (for example, the VAT treatment of financial services, reviewing and clarifying HMRC’s guidance and forms as they apply to small businesses, simplifying and modernising HMRC’s income tax services and considering the expansion of the scope of the cash basis scheme to calculate and pay income tax), which is interesting given that the Office of Tax Simplification will shortly be abolished by the Spring Finance Bill 2023, and
• detailed various other tax announcements that require consideration—the key ones are outlined in this News Analysis

Alongside Spring Budget 2023, HM Treasury and HMRC published several other documents including policy papers, a collection of consultations, calls for evidence and other documents related to tax administration reforms and tax policy development.

As previously , the Spring Finance Bill 2023 (SFB 2023) will be published on Thursday 23 March 2023. In addition, the government has announced that it will bring forward a further set of tax administration and maintenance announcements later in the spring at a Tax Administration and Maintenance Day.

References below to paragraph numbers are to those paragraphs in , being the main Spring Budget document published by HM Treasury (pdf web version). References are also made to paragraphs in the  published alongside the main Budget document and, where applicable, to tax information and impact notes (TIINs), also known as policy papers.

Download the Spring Budget 2023 â€”key announcements for Tax practitioners here, which includes initial reactions from the market.

For the key announcements relevant to Private Client pracitioners, see Spring Budget 2023—key announcements for Private Client practitioners

For the key measures announced across the practice areas covered by Practical Guidance see: Spring Budget 2023—key announcements across Practical Guidance