The Chancellor of the Exchequer caused a great furore last October, when he proposed sweeping away a vast swathe of allowances relating to Capital Gains Tax.

He apparently wanted to introduce a “simpler” single CGT tax rate of 18 per cent. Under the old rules, anyone selling a business that had been trading for some years would have expected to pay a Capital Gains Tax at 10 per cent.

The new rate was therefore an 80 per cent increase – little wonder that there were protests.

Fortunately, the Chancellor has had a change of heart and has responded to the protests.

Now shopkeepers and others with more than a five per cent interest in a business will qualify for a special 10 per cent rate of CGT.

Less fortunate are those who have been long time investors in Save As You Earn schemes.

For example, last year 3,000 DSGi employees shared a £20 million payout, earning 120 per cent on their investment.

This would have exceeded their personal allowances and under the new legislation the balance would attract the 18 per cent rate.

This same ruling will also affect directors of large companies who have previously enjoyed purchasing shares at generous incentives.

They are unlikely to have been allocated enough shares to cross the five per cent ownership threshold, so they too will pay 18 per cent CGT.

At least these changes will assist those who are planning to sell their businesses.

Let us hope the rules don’t get changed again. Mind you, it will be essential to keep good records, as the new 10 per cent CGT rate only applies to gains of up to £1m accrued over a lifetime.
Once a gain exceeds £1m, the rate reverts to 18 per cent. I must admit I will be very happy if I ever have to pay 18 per cent.

I have been reading a book called A Year Without “Made in China”: One Family’s True Life Adventure in the Global Economy.

It is a wonderful book, which tells the story of a mother who decided to give up on buying Chinese goods for a year.

The book emphasises how much we rely on China. At times, it was funny, especially when her four-year-old son pleaded for the family to stop their campaign so he could buy a toy.

Her husband couldn’t buy tools for his business, to say nothing of the problems they had trying to buy shirts, shoes, a TV or a fridge.

The book came to mind again when the Chinese restaurant owner next door asked me to fix some things he had bought in a TCL shop in China.

 He carried in a 42in LCD TV, a notebook PC and a pocket-sized MPEG4 video player with the request to “set them up for the UK”.

The TCL TV was no problem, as it worked straight off, as did the MPEG4 player. The TCL notebook PC was more of a challenge, as the screen instructions were in Chinese, but soon it was set, too.

I couldn’t resist looking inside these products and they had each been made to a very high standard.

No wonder TCL of China has been chosen to make some of the TV sets that sell under the Philips brand.

A friend reminded me of his visit to a TCL factory in China, when he saw a sign that translated as: “If you don’t work diligently today, you will be diligently looking for work tomorrow”.

No wonder TCL products are so good.