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Major concessions in the tax system, particularly on capital gains tax, are unlikely because the Government is on course to overshoot its public borrowing forecasts by £6 billion, Grant Thornton has suggested.
As Alistair Darling prepares to reveal details of CGT reform within the next three weeks, the financial advice company said the Government 'needs every ounce of revenue it can lay its hands on to minimise overspend'
Grant Thornton's Maurice Fitzpatrick said he believed any concessions made to CGT before the new tax year beginning April next year will be minimal and will not calm wide spread unrest among entrepreneurs and investors, who are disappointed with the 80% rise in tax due when selling their businesses or investment holdings.
Mr Fitzpatrick added that proposals on income shifting — due to be released early next month — and on residence and domicile next year will be revenue raising initiatives intended to sate a 'cash-hungry' Treasury.
He said: 'Despite 15 years of continuous economic growth, the Treasury is borrowing in excess of £100 million per day.
'It is inconceivable that it would wish to increase public borrowing forecasts; therefore, it is expected that additional revenue will have to come from the tax system.
'In order to cover an overshoot of £6 billion, the Government would have to raise taxes equivalent to an additional £250 per household per annum.'
