by David Oliver

Intro | Page2

The taper period is reduced to four years and the thresholds for qualifying as a business asset are reduced. Most dramatically, the business asset taper is now to be available to all holdings of shares in unquoted companies and to employee shareholdings. This will give a tremendous boost to the private equity market. My main concern is that the gap between the tax treatment of business assets and quoted portfolio investments is now extreme. Non business asset gains can suffer a high effective CGT rate, especially if inflation picks up. The ordinary saver just does not have the opportunity or the risk resistance to become involved in private equity investments. Modest savers can use ISAs, the rich can invest partly in private equity, but the ordinary saver building up a portfolio has a tough time.

Everyone will doubtless find something to grumble about in this budget, but there are plenty of new openings and benefits to be had. A good time for a thorough spring-clean of individual and corporate finances.

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