The Chancellor Jeremy Hunt has delivered his Autumn Statement of ‘110 measures to help grow the British economy’. The Chancellor says that the government has taken difficult decisions to put the economy back on track during a cost-of-living crisis and has managed to halve inflation.
The Chancellor’s priorities have been to avoid big government spending and high tax by creating a strategy to cut taxes and reward hard work with growth measures for business.
What the Statement means for you
The economic backdrop to the Autumn Statement was a challenging one, with a combination of over 11% inflation, recession and the need to re-establish the UK’s financial credibility. The question remains, however, whether the UK economy will fulfil the relatively optimistic growth forecasts now implicit in the projections of the Office for Budget Responsibility (OBR).
The personal allowance will remain at £12,570 for an extra two tax years until 5 April 2028 and the higher rate threshold will stay at £50,270, the levels that first took effect in 2021/22. The domestic energy price guarantee (EPG) will increase to £3,000 for one year from 1 April 2023 and equivalent support will continue to be provided in Northern Ireland. However, the parameters of the EPG scheme may be revised. The support for households that use alternative fuels, such as heating oil, to heat their homes will be doubled to £200 for 2022/23.
The level at which employers start to pay employer NICs for their employees will remain at the current £9,100 until April 2028. The employment allowance will stay at £5,000. Support for eligible retail, hospitality and leisure businesses will be extended and increased from 50% to 75% business rates relief up to £110,000 per business in 2023/24. Increases in the bills will be capped at £600 a year from 1 April 2023 for the smallest businesses that lose eligibility or see reductions in the supporting small business scheme or rural rate relief.
The class 1 primary threshold and class 2 lower profits limit will remain aligned with the personal allowance (£12,570) until April 2028. The upper earnings limit and class 4 upper profits limit will remain aligned to the higher rate threshold at £50,270 through to April 2028. The lower earnings limit (£6,396) and the small profits threshold (£6,725) will remain unchanged in 2023/24. For 2023/24, the class 2 rate will be £3.45 a week and the voluntary class 3 rate will be £17.45 a week.