LONDON, ENGLAND - MARCH 06: Chancellor of the Exchequer, Jeremy Hunt, leaves 11 Downing Street with his ministerial box before delivering his Budget in the Houses of Parliament on March 06, 2024 in London, England. Chancellor Jeremy Hunt delivers his 2024 Spring Budget to Parliament. (Photo by Stefan Rousseau - WPA Pool/Getty Images)

Jeremy Hunt revealed a series of tax cuts and rises and also stole one of Labour’s key plans as he unveiled his pre-general election Budget.

Here, HuffPost UK looks at some of the chancellor’s big announcements in the final Budget before the general election.

National Insurance cut

The chancellor has cut national insurance for millions of workers by a further two percentage points.

It follows on from an identical cut he announced in the Autumn Statement last November.

Legislation will be rushed through parliament so it takes effect from April, meaning voters will see the impact in their pay packets as soon as possible.

Combined with the previous NI cut, Hunt said 27 million employees will benefit from a £900 tax cut.

However this is against a backdrop of the overall tax burden actually being set to rise to its highest ever level.

And according to the IPPR think-tank, almost half of the national insurance give-away would end up in the pockets of the richest fifth of households.

The move is also likely to anger Tory MPs, who were keener for the chancellor to cut income tax.

Hunt appears to have plumped for a national insurance cut because it is the less expensive option, and is also less likely to push up inflation.

Child Benefit

The way parents lose child benefit will be changed to address the current “confusing and unfair” system and save half a million families £1300 next year, Hunt said.

Child benefit is paid to families with children under the age of 16 or under 20 if they are still in education or training.

But under the High Income Child Benefit Charge (HICBC), introduced in January 2013, families start to lose it once at least one parent earns over £50,000.

It means two parents earning £49,000 a year receive the benefit in full but a household earning a lot less than that does not if just one parent earns over £50,000.

Hunt said this would change and the government would consult on moving the HICBC to a household-based system, to be introduced by April 2026.

Because this will take time, Hunt said from April the threshold at which child benefit is reduced will be raised from from £50,000 to £60,000. The taper at which it is withdrawn will also be raised to £80,000.

The chancellor said this would mean an extra 170,000 families would no longer have to pay the HICBC.

And nearly half a million families with children would save an average of around £1300 next year.

Fuel duty frozen

The 5p cut in fuel duty has be extended for another 12 months, at a cost of £5bn to the Treasury.

Hunt said this would save the average car driver £50 next year and bring total savings since the 5p cut was introduced to around £250.

Fuel duty is currently 52.95p per litre as a result of a “temporary” 5p cut announced by Rishi Sunak in 2022, when he was still chancellor.

It has not increased since March 2011, when it was frozen at 57.95p by George Osborne.

Alcohol duty frozen

Alcohol duty will be frozen until February 2025. It had been due to rise by 3%. It was previously frozen at the 2023 autumn statement until August.

Hunt said it would benefits 38,000 pubs all across the UK. No doubt by coincidence, it means the duty will be frozen at the time of the election, which must be held in January 2025 at the latest.

Windfall Tax

The windfall tax on the profits of oil and gas companies has been extended by a year, which Hunt said would raise £1.5 bn for the Treasury.

Hunt is facing a major Tory rebellion over the move, with Scottish Tory leader Douglas Ross having warned he will not vote for it.

The tax is bitterly opposed by Scottish Tory MPs, who say it will put jobs in the north east of Scotland at risk.

The so-called energy profit levy was first introduced in May 2022 after a spike in energy prices following Russia’s invasion of Ukraine.

Hunt increased the tax in November 2022 from 25% rate to 35%, and also extended it until 2028 while expanding it to electricity generators with a levy of 45%

Non-dom tax status abolished

One of the most obvious signs that an election is near, was confirmation that Hunt is stealing one of Labour’s key pledges and scrapping the non-dom tax status.

The loophole enjoyed by wealthy foreigners based in the UK allows them to not pay tax on money earned abroad.

Hunt said this would be abolished and raise raise £2.7bn a year for the government and use it to pay for tax cuts.

Labour has long promised to axe the status and has pledged to spend the money on the NHS and education.

The party will now either have to find the money to pay for its pledges elsewhere or oppose the cut in taxes.

Hunt’s move is a major U-turn, as the Conservatives have long defended the special tax status by insisting it ensures the UK remains an attractive place for wealthy people to live and invest.

From April 2025, under the Tory plan, new arrivals to the UK will not be required to pay any tax on foreign income and gains for their first four years of UK residency.

But after four years, those who continue to live in the UK will pay the same tax as other UK residents.

Vape tax

Another tax rise announced today was a new tax on vaping, set to be introduced from October 2026.

Hunt said this was to “discourage non-smokers from taking up vaping”.

Vape products are currently subject to VAT but do not have a dedicated levy. A consultation will be launched to iron out the details.

Sunak has made the phasing out of smoking one of his headline policies.

So a one-off increase in tobacco duty will be imposed at the same time to maintain the financial incentive to choose vaping over smoking.

QOSHE - Budget 2024: Key Points And What It Means For You At-A-Glance - Ned Simons
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Budget 2024: Key Points And What It Means For You At-A-Glance

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06.03.2024

LONDON, ENGLAND - MARCH 06: Chancellor of the Exchequer, Jeremy Hunt, leaves 11 Downing Street with his ministerial box before delivering his Budget in the Houses of Parliament on March 06, 2024 in London, England. Chancellor Jeremy Hunt delivers his 2024 Spring Budget to Parliament. (Photo by Stefan Rousseau - WPA Pool/Getty Images)

Jeremy Hunt revealed a series of tax cuts and rises and also stole one of Labour’s key plans as he unveiled his pre-general election Budget.

Here, HuffPost UK looks at some of the chancellor’s big announcements in the final Budget before the general election.

National Insurance cut

The chancellor has cut national insurance for millions of workers by a further two percentage points.

It follows on from an identical cut he announced in the Autumn Statement last November.

Legislation will be rushed through parliament so it takes effect from April, meaning voters will see the impact in their pay packets as soon as possible.

Combined with the previous NI cut, Hunt said 27 million employees will benefit from a £900 tax cut.

However this is against a backdrop of the overall tax burden actually being set to rise to its highest ever level.

And according to the IPPR think-tank, almost half of the national insurance give-away would end up in the pockets of the richest fifth of households.

The move is also likely to anger Tory MPs, who were keener for the chancellor to cut income tax.

Hunt appears........

© HuffPost


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