Mixed response to the budget from hairdressing industry

HJi gathered comments from across the UK on the recent Budget.

Mark Coray, president of the National Hairdressers' Federation said:

"The NHF welcomes any move by the Government to put more money into shoppers' pockets, and so the chancellor's decision significantly to raise personal income tax allowances from next April could be good news if it gives people a bit more confidence to spend.

"Mr Osborne's announcement of a simplified tax system for very small firms plus his commitment to look at enterprise loans to help more young people start up in business could also be of benefit to a traditionally young and entrepreneurial sector such as hairdressing.

"However, Mr Osborne missed an opportunity when it came to his planned reforms around VAT loopholes. It's not just the unfairness of how VAT is taxed on different goods and services that is an issue but how VAT is structured, particularly in relation to small, labour-intensive businesses such as hairdressing salons.

"The NHF through its Cut & Dried? campaign has been urging the Government to reform VAT to make it more flexible and responsive to the needs of small businesses. It was disappointing Mr Osborne did not use this Budget to help small businesses in this way."

Red tape changes

Alan Simpson, managing director, Cantemporary Salons, Middlesbrough: "I welcome the red-tape changes, however more has to be done to make it easier and fairer for employers to create real employment opportunities. A reduction in national insurance payments  or a national insurance holiday would have encouraged small businesses to take on staff. I would also have liked to see a VAT cut, as I think Vat is to high for our industry at 20%, it should be less, or the threshold risen to £150,000 or more.

"We really needed a budget to get the economy moving, as this would have helped business and employment. I am afraid what we got, will simply be moving money around with no real benefit to the overall economy."

Not a ground-breaking Budget

Toby Dicker, managing director of The Chapel said: "It was not the ground-breaking Budget that could have been achieved. Welcome was the raising of the tax-free allowance to £9,205 meaning many people and particularly young hairdressers would see a significant tax benefit. Also welcome for businesses is the reduction in Corporation tax over the next three years from 26% to 22%.But as an industry that is over taxed to say the least, particularly as we add value to our product through labour costs, I think that leaving corporation tax at 26% in place for businesses and  reducing VAT on services or reducing the employers contributions to National Insurance for the extortionate percentage extra we have to pay for employing people, would be a far more effective way of sharing out the profits and providing more employment for all."

Good for client spending power

Russell McGrath, operations director, Clipso Salon Group said: "Following the Budget our team and clients will certainly be slightly better off with the increase in the personal allowance threshold. Although over the course of a year it is a relatively small amount, at least it is a step in the right direction. The other main benefit for businesses who are making profit is the 1% decrease in the corporation tax. This again can only help those companies who are consistently performing well."

Ian Davies, owner of Ocean Hairdressing, Cardiff. :''I would have liked to have seen a new way of dealing with VAT. I think the VAT threshold for businesses should have been raised to £75,000 to help smaller businesses. I also think the minimum wage should have been reassessed. There is no relief when training someone over the age of 18, so most employers will not give people over the age of 18 the chance to train as they become way too expensive after 12 months compared to a 16 year old.'

Faruk Mohammed, director of Hair by JFK, Edinburgh said:"I think it's good that the tax threshold has been raised to £9,000. This means people will have more disposable income so it's good for us as a business. The qualification tax has also been reduced so this is good news."

VAT not addressed

Commented Alan Stewart, director of Rainbow Rooms International, Glasgow: "The proposed drop in corporation tax is a benefit if trading is good, the problem is, trading is difficult because taxation in general is high. 20% VAT on labour intensive service industries like hairdressing is turning the clock back to when hairdressing was a luxury purchase. When this happens it drives a black market."

Said Dawn Lawrence, co-owner Q Hair & Beauty: "'I am delighted to see provision made specifically for small businesses to aid growth and expansion as oppose to further taxation inhibiting confidence."

Diana Bertolone, The Academy Of Hair commented: "I welcome that the Budget appears to be entrepreneur-friendly, in a sector like hairdressing this is by far the best gain at the moment, with a focus on more apprenticeships. The chancellor's decision to raise personal income allowances may restore consumer spending."