Chancellor Rishi Sunak gave his Spring Statement on 23 March 2022: these are our live highlights, introducing a rise in the National Insurance contribution (NICs) threhold and 0% VAT on energy saving products, increased capital allowances and a reduction in Income tax from 2024. A more detailed summary will follow later today. The chancellor refered to the on-going war in Ukraine and how his is considering the UK's responses to that war and to our security in that respect and in the state of our economy.

"We stand with Ukraine."

Actions to sanction Russia are not cost-free.

The OBR has expressed uncertainty over the effects of the war: it's too early to speculate.

  • Forcast growth is 3%, lowering in the next three years to 1.7%
  • Unemployment is at 3.9%
  • Inflation forcast to rise to  7.4%

Three immediate measures are announced:

  • Fuel duty cut by 5 pence per litre from 6pm today: until March 2023
  • 0% rate VAT to apply to a wide range of energy saving products for households and for wind turbines etc, for the next five years.
    • The reduced rate will not apply to taxpayers in Northern Ireland due to the post-Brexit agreement with the EU
  • The household support fund will be doubled

Fiscal rules

  • Underlying government debt is forcast to fall, slightly.
  • The cost of borrowing is set to reach new highs
  • Next year the UK will pay £83billion in interest on government debt

The overaching ambition to cut taxes over the term of this parliament

Publishing a new tax plan today revealing:

  • A 'principled approach' to cutting taxes
  • Continued discipline in spending
  • Help for families on cost of living

New tax measures

The levy for Health & Social care will apply: [this is the 1.25% increase in the rate of NICs and dividends from 6 April 2022, as announced last year]

The employee NICs threshold for 2022-23 is increased by £3,000 to £12,570, equalising the NICs threshold with the Income Tax personal allowance, from July 2022.

There will be reforms R & D credits to ensure that they are given as planned and to expand R & D relievable areas to include data, cloud computing and pure maths.

The capital allowances Super Deduction is end to end next year. The Autumn Budget 2022 will introduce new tax cuts for business.

The capital allowances Annual Allowance will increase to £1,000,000.

Business rates: a 50% discount will apply in 2022-23 to businesses in retail and leisure industries.

Small business [employers] will benefit from an increase the Employers NICs allowance from £4,000 to £5,000 from 2022-23.

Income tax: in 2024 there will be cut in the basic rate of income tax to 19%.

 

 

 

 

 

 

 

 

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