With virtually no money to play with, Chancellor George Osborne has proposed a ‘fiscally neutral’ Budget, but there were a few point of interest for investors…
- An abolition on the payment of stamp duty (0.5pc) from next April on the purchase of shares quoted on the Alternative Investment Market in a move designed to force capital into smaller companies. This should remove the distortion between investing in shares and spread-betting for those stocks and should help liquidity. Read more about this here. Marcus Stuttard, the head of AIM, has been reported as saying that stamp duty is a barrier to capital raising for small caps. Separately, the Government is already consulting on allowing investors to buy shares through ISAs.
- All the major housebuilders have seen their share prices rise on news that the Government is set to pump more cash in to supporting buyers of new homes. The ‘Help to Buy’ shared equity scheme will see the Government lend up to 20pc of the cost of a new home to help potential buyers secure a deposit and mortgage. Buyers will have to stump up a deposit of 5pc before the Government steps in with interest-free loans of up to 20pc on homes worth less than £600,000. A second part of the scheme involves a £130bn mortgage guarantee scheme to help current homeowners move up the property ladder.
- Shares in UK gas producer Igas Energy (LON:IGAS) jumped on news that the Government will introduce a new tax regime for shale gas development in the UK to promote early investment.
- Confirmation that the Government will later this year sign contracts for future North Sea decommissioning relief, which Osborne said was already increasing investment there.
- R&D credit increased to 10pc – which is good news for innovators.
- Shares in many brewers and pub groups have moved into positive territory on news that the beer duty escalator has been scrapped and a penny knocked off the price of a pint.