Jeremy Hunt cuts National Insurance by 2p
Wednesday 6 March, 2024
Jeremy Hunt’s highly anticipated budget announcement has now clearly outlined the allocation of the country’s resources to the House of Commons. It serves as a reflection of the government's overarching vision and response to the prevailing economic challenges and opportunities.
With expectations high and stakes significant, the unveiling of the budget represents a crucial juncture for policymakers, businesses, and the public alike, as they assess its implications for growth, prosperity, and societal well-being before the all-important general election.
Budget Headlines
Tax and Income Support
- National Insurance, a payroll tax, cut by 2p in the pound for employees and the self-employed
- Non-dom tax regime, for UK residents whose permanent home is overseas, to be replaced with new rules from April 2025
- £5,000 "British ISA" tax allowance for individual savers to invest in UK-listed companies
- Longer repayment period for people on benefits taking out emergency budgeting loans from the government
- £90 fee to obtain a debt relief order scrapped
- Government fund for people struggling with cost-of-living pressures to continue for another six months
Cigarettes, Vapes and Alcohol
- Freeze on alcohol duty, which had been due to end in August, to continue until February 2025
- New tax on vaping products to start in October 2026, following a consultation
- Existing tax on tobacco to increase, to maintain the "financial incentive to choose vaping over smoking"
Transport and Energy
- Fuel duty frozen again, with the 5p cut in fuel duty on petrol and diesel, due to end later this month, kept for another year
- £160m deal for UK government to purchase site of planned Wylfa nuclear site in north Wales
- "Windfall" tax on the profits of energy firms, which had been scheduled to end in March 2028, extended until 2029
- Air passenger duty, the tax paid on flights, to go up for business class tickets
Public debt, inflation and the economy
- Office for Budget Responsibility predicts UK economy to grow by 0.8% this year and 1.9% next year
- Growth of 2% predicted for 2026, with 1.8% in 2027 and 1.7% in 2028
- UK's inflation rate forecast to fall below 2% target "in just a few months' time"
- Underlying debt, excluding Bank of England debt, forecast to be 91.7% of GDP this year, rising to 92.8% next year
- Overall day-to-day government spending to grow by 1% in real terms over next five years
Business and Investment
- Threshold at which small businesses must register to pay VAT raised from £85,000 to £90,000 from April
- Tax reliefs for touring and orchestral productions, which had to been due to end in March 2025, made permanent
Additional measures
- £1m for a memorial to honour Muslims who fought for Britain during World War One and Two
- A new tax credit for independent UK films with a budget of less than £15m
