This week was all about the Budget.
The last few years have not been easy for the British economy following the pandemic and energy shock. But progress has been made with inflation now falling from 11.1% to 4%, the UK economy outperforming its European neighbours and debt on track to fall as a share of GDP. Consequently, the Chancellor now feels it’s the right time to make tax cuts that further reward work and grow the economy.
Here’s a brief summary of some of the key measures announced:
- An additional 2% cut in National Insurance taking the rate down to 8%, ensuring hard work always pays. In addition to the 2% cut in the Autumn statement, this means an annual saving of £900 in total for the average worker.
- A commitment to remove the fundamental unfairness with respect to the High-Income Child Benefit Charge by moving to a system based on household rather than individual income by April 2026. And in the meantime, half a million families supported by raising the threshold to £60k, as well as halving the rate so it’s not paid in full until earnings are over £80k. This means an average annual saving of £1,260.
- Alcohol duty frozen again, which is good news for our pubs and hospitality sector.
- Fuel duty frozen again which is good for all of us.
- Investing billions more in our NHS.
- Increasing the VAT registration threshold for small businesses to £90k, helping them to grow.
- And specifically for Surrey, a devolution deal allowing more decisions to be made here by people that know what Surrey needs.
More detail can be found here.
https://www.gov.uk/government/publications/spring-budget-2024/spring-bu…
I am particularly pleased to see the planned changes to the High-Income Child Benefit Charge. The way it currently works is simply not fair, with two parents each earning £49k a year receiving Child Benefit in full, whilst a household earning less overall but with one parent earning over £50k seeing some or all of their benefit withdrawn. Child Benefit is crucial to help parents pay for the costs associated with having children, so I’m delighted that this much needed change is being made. In conjunction with the National Insurance cut, these measures ensure hardworking families get to keep more of their money. And that’s exactly how it should be.
