Chancellor delays CGT taper relief decision until 2008

Chancellor Alistair Darling told the recent CBI conference that he would deliver a decision on the abolition of CGT taper relief "within the next three weeks".

However, on Thursday, Darling told the Commons that he would not be able to announce any changes before Christmas, so small business owners will have to wait until the New Year to find out whether CGT taper relief will be abolished, as per the Pre-Budget Report, or if the Chancellor is prepared to re-think the proposed changes.

Darling told the Commons that we needed more time to study various representations that have been made since the Pre-Budget Report: "It is not now going to be possible to conclude that process until the new year", he said.

Unsurprisingly, opponents of the proposed changes have expressed disappointment at the delay:

Richard Lambert, Director-General of the CBI, said:

"We are glad that the Chancellor is paying attention to the submissions he has received from the business community, but he needs to get on with this decision urgently, as he promised at the CBI's conference a fortnight ago."

"People need to be able to make decisions about their businesses - whether to invest, or whether to sell up. This uncertainty mustn't be allowed to continue."

Miles Templeman, Director General of the Institute of Directors said:

“The Government’s pro-enterprise credentials were seriously damaged by the original announcement in the Pre-Budget Report. Having committed to announcing the way forward before Christmas, the Chancellor has now deferred a final announcement until the New Year. This will lead to continued uncertainty at a time when business owners need to take critical decisions. The Government should recognise the impact of this by considering deferring implementation of the changes, and commit now to a firm date on which its final decision will be announced. We can only hope that the Government will use the extra time to make the right, pro-enterprise decision. If it does so, we will welcome that. If it does not, businesses will have every reason to complain.”