Chancellor Philip Hammond delivered his first (and last) Spring Budget today. In his opening remarks, Hammond announced that we are building the foundations of a stronger, fairer and more global Britain as the UK prepares to exit the European Union.
Our specialist tax and VAT partners from around the UK watched the announcement and have produced an ‘at a glance’ list of the main proposals, to help you digest the information that is relevant to you.
They have also provided their immediate reactions to some of these proposals, which you can view here.
- UK growth is up and the UK was the second fastest growing economy in the G7 in 2016
- Growth forecast upgraded from 1.4% to 2.0% for 2017, but forecasted to slow to 1.6% in 2018, 1.7% in 2019, 1.9% in 2020, before returning back up to 2.0% in 2021
- Government borrowing predicted to be lower than previously expected over the entire forecast period: £51.7bn in 2016/17, £58.3bn in 2017/18, through to £16.8bn in 2021/22
- Inflation forecast to rise to 2.4% in 2017/18, before falling to 2.3% and 2.0% in subsequent years
- Higher proportion of women in the workforce than ever before
- A further 650,000 people expected to be in employment by 2021
- Measures announced to ease business rate burden amount to cuts of £435m
- Capping business rate rises at £50 a month for those leaving small business rate relief
- £1,000 business rate discount for pubs with rateable value under £100k
- £300m fund for businesses facing large increases to rates bills
- Corporation Tax to fall to 17% by 2020, as planned
Personal taxation, pensions and savings
- Class 4 National Insurance Contributions for the self-employed will increase by 1% to 10% in April 2018 and to 11% in April 2019
- Reduction of tax-free dividend allowance from £5,000 to £2,000 from April 2018
- National Savings Bond available from April 2017 will pay 2.2% interest on deposits up to £3,000
- National Living Wage will rise to £7.50 in April 2017
- Personal tax free allowance to rise to £12,500 by 2020
- Universal Credit taper rate to be reduced in April 2017 from 65% to 63%
- Funding announced for 110 new free schools
- £216m over next three years to repair and rebuild school buildings
- £500m a year to support technical education for 16-19 year olds
- Tampon tax receipts to fund further £12m for women’s charities
Health and social care
- £2bn additional funding over three years for adult social care in England
- Extra £100m to place in A&E departments by next Winter in England
- £200m to encourage investment in local full-fibre broadband networks
- £16m for new 5G mobile technology hub
- £690m competition for local councils to tackle urban congestion across England
- £350m additional funding for Scottish Government, £200m for Welsh Government and almost £120m for Northern Ireland Executive
We will also be issuing a complete summary of the 2017 Budget tomorrow, which will offer a clear and concise commentary of the main Budget proposals, focusing on the issues pertinent to you, your family and your business.