Government's higher-rate tax band and apprenticeship pay increase is "step forward" for PR industry

Chancellor George Osborne has announced increases in personal allowance, apprenticeship pay and a higher rate tax threshold - factors that will benefit the PR industry, says the PRCA.

Government's higher-rate tax band and apprenticeship pay increase is "step forward" for PR industry

In his 2015 Budget speech, Osborne announced he would increase the personal tax-free allowance to £10,800 in April 2016 and £11,000 in 2017, meaning that the average working taxpayer "will be over £900 a year better off".

While this will be welcomed by those starting out in the PR industry, PRCA director general Francis Ingham pointed out a flaw: "This has to be caveated with the fact it is not being accompanied by a change in National Insurance."

Similarly the 20 per cent increase in apprenticeship pay, announced by the Prime Minister ahead of yesterday’s Budget, is a "step forward of real value to industry newcomers", according to Ingham. Pay for apprentices will rise by 57p to £3.30 an hour.

Osborne also announced the higher-rate tax band would be increased to £43,300 from 2017-18. The current 40 per cent income tax threshold is set at £41,865 a year and is set to increase to £42,385 next month.

Ingham commented: "We are an industry where freelancers and independent practitioners have always flourished and so the death knell Osborne sounded for annual tax returns will be staunchly welcomed. If parties are really committed to ‘helping working people’, we need to alleviate the burden of regulation." 

Further, Osborne said the Government would pilot a new scheme in Greater Manchester in April, to enable 100 per cent retention of growth in business rates, with a similar scheme to be rolled out in Cambridge and Peterborough.

Ingham added: "While London remains the global centre of PR, Osborne’s encouraging move on local business rates in that other PR hub Manchester, with an offer to Cambridge and an invitation to all other local authorities, will hopefully see cities renew their efforts to support SMEs and job creation."

However, others viewed Osborne's Budget speech as having a more narrow application.

Nick Faith, director of Westminster Policy Institute, said: "The real winners of the Budget are small business owners looking to export to China who drive to work, earn under £40,000, enjoy a tipple and are saving up to buy their first house."

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