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Legal, Finance and Business – March 2024

The Chancellor outlined his latest Budget in the House of Commons earlier this month (Wednesday 6th March).

In the last scheduled Budget before the general election, expected to take place at some point this year, Jeremy Hunt announced a 2p cut to National Insurance, a new tax on vaping and an increase to the salary threshold for those claiming child benefit.

After listening to Mr Hunt’s address to MPs, the Wolds Weekly has put together a Budget summary, with the main areas that will impact those living in Driffield and the Wolds:

● National Insurance, to which all workers over the age of 16 contribute to until they reach state pension age, was cut by 2p in the pound for employees and those who are self-employed. Someone who earns £25,000 per year will save £249 per year as a result. Those who are higher earners will receive an extra £754 every year
● The salary threshold for people paying income tax and national insurance continues to be frozen. This means people will pay more tax as their income increases. This is called fiscal drag
● A £5,000 UK ISA tax allowance will be set up for savers who invest in UK-focused shares

Benefits and income support
● Full child benefits will be paid to households where the highest-earning parent earns up to £60,000, up from £50,000
● Partial child benefit to be paid where the highest earning parent earns up to £80,000
● Longer repayment period for those on benefits who take out emergency loans from the government

● Government fund for people who are struggling with the cost of living to continue for another six months
● The £90 administration fee to obtain a debt relief order has been scrapped

Cigarettes, vapes and alcohol
● Alcohol duty frozen until next February. The freeze had been due to end in August
● Vaping products will be taxed from October 2026
● Tobacco duty rises by £2 per 100 cigarettes, which means vaping will stay cheaper

Transport and energy
● Fuel duty was frozen, with the 5p cut in fuel duty continuing for another 12 months
● Further £120 million for a government fund that will invest in green energy projects

● Higher rate of tax paid on profits from selling property cut to 23 per cent, from 28 per cent
● Tax breaks for owners of holiday lets scrapped
● Stamp duty tax break when purchasing multiple properties in England

Public debt, inflation and economy
● UK economy predicted to grow 0.8 per cent in 2024 and 1.9 per cent in 2025
● Two per cent growth forecast for 2026, 1.8 per cent in 2027 and 1.7 per cent in 2028
● Rate of inflation in UK expected to fall below target of two per cent before the end of June and fall to 1.5 per cent in 2025
● Day to day government spending to grow by one per cent over the next five years
● NHS budget to rise £2.5 billion in 2025 and will receive £3.4 billion up to 2030

Business and investment
● The threshold that small businesses must register to pay VAT rises from £85,000 to £90,000 in April
● COVID government loan scheme for small businesses extended until March 2026

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