Published On: Wed, Mar 6th, 2024

Budget 2024: 10 major announcements from Chancellor Jeremy Hunt | Personal Finance | Finance

Chancellor of the Exchequer Jeremy Hunt

Chancellor of the Exchequer Jeremy Hunt (Image: House of Commons/UK Parliament/PA Wire)

Chancellor Jeremy Hunt delivered his Spring Budget in the House of Commons today.

Mr Hunt said the focus of today’s budget was permanent cuts in taxation, he acknowledged interest rates were still high but said the government will be able to help families with long-term ‘permanent’ support with its new economic policies.

However, there was also a key focus on growing Britain’s economy, with the Chancellor saying the economy is expected to grow significantly in the next couple of years. For many members of the public, today’s announcements mean a wide range of changes that could affect their personal finances.

Introducing his statement today, Mr Hunt said: “Because of the progress we’ve made, because we are delivering the Prime Minister’s economic priorities, we can now help families not just with temporary cost-of-living support, but with permanent cuts in taxation.”

He added: “Instead of going back to square one, the policies I announce today mean more investment, more jobs, better public services, and lower taxes in a Budget for long-term growth.”

Here are all the key announcements made by the Chancellor in today’s Spring Budget.

National Insurance cut

The Chancellor confirmed a further cut to the rate of National Insurance. It comes after the government previously cut the rate from 12 per cent to 10 per cent back in January.

From April 6, the government will cut the rate by another 2 per cent, from 10 per cent to 8 per cent, saving the ‘average worker’ £450 a year. Self-employed national insurance will also be cut from 8 per cent to 6 per cent.

Mr Hunt said: “From April 6, employee national insurance will be cut by another 2p, from 10% to 8%, and self-employed national insurance will be cut from 8% to 6%.”

“It means an additional £450 a year for the average employee or £350 for someone self-employed. When combined with the autumn reductions, it means 27 million employees will get an average tax cut of £900 a year and two million self-employed a tax cut averaging £650.”

Child Benefit reform

Mr Hunt told the Commons he would be addressing the ‘unfairness’ in the Child Benefit system. Currently, parents on an income above £50,000 are hit with a high income tax charge, but he said the system is set to be reformed.

A new household-based system will be introduced by April 2026, he said. However, a more instant change will be introduced before then with the threshold rising from £50,000 to £60,000.

Mr Hunt said the current system “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.”

He told the Commons: “Today I set out plans to end that unfairness. Doing so requires significant reform to the tax system including allowing HMRC to collect household level information.”

“We will therefore consult on moving the high-income child benefit charge to a household-based system to be introduced by April 2026. But because that is not a quick fix, I make two changes today to make the current system fairer.”

He explained: “I confirm that from this April the high-income child benefit charge threshold will be raised from £50,000 to £60,000. We will raise the top of the taper at which it is withdrawn to £80,000. That means no one earning under £60,000 will pay the charge, taking 170,000 families out of paying it altogether. And because of the higher taper and threshold, nearly half a million families with children will save an average of around £1,300 next year.”

Household Support Fund extension

The Chancellor confirmed the Household Support Fund which was initially set to end on March 31 has now been extended for an additional six months.

Mr Hunt told the Commons the fund “was set up on a temporary basis and due to conclude at the end of this month”.

He told MPs: “I have decided that with the battle against inflation still not over now is not the time to stop the targeted help it offers. We will therefore continue it at current levels for another six months.”

The Household Support Fund is divided between individual councils with each authority deciding how to allocate the funds. Many councils used the fund to support foodbanks, provide free meals to children during holidays, hand out one-off payments to vulnerable households or help people struggling to pay their bills.

Alcohol Duty freeze

The alcohol duty freeze will be extended until February 2025 which Mr Hunt claims will benefit 30,000 pubs across the UK. The Chancellor told the Commons: “In the autumn statement I froze alcohol duty until August of this year. Without any action today, it would have been due to rise by 3%.”

However, he said he had deliberated with MPs over the tax, adding: “So today I have decided to extend the alcohol duty freeze until February 2025. This benefits 38,000 pubs all across the UK and on top of the £13,000 saving a typical pub will get from the 75% business rates discount I announced in the autumn.”

“We value our hospitality industry and we are backing the great British pub.”

Fuel duty freeze

The chancellor has frozen fuel duty once again and has also extended the 5p cut to fuel duty which was previously introduced in 2022 and was set to run out this month. Now, it will be extended for an additional 12 months.

He said: “The shadow chancellor complained about the freeze on fuel duty and Labour has opposed it at every opportunity. The Labour Mayor of London wants to punish motorists even more with his Ulez plans. But lots of families and sole traders depend on their car.”

“If I did nothing fuel duty would increase by 13% this month.” He added: “I have as a result decided to maintain the 5p cut and freeze fuel duty for a further 12 months. This will save the average car driver £50 next year and bring total savings since the 5p cut was introduced to around £250.”

“Taken together with the alcohol duty freeze, this decision also reduces headline inflation by 0.2 percentage points in 2024-25 allowing us to make faster progress towards the Bank of England’s 2% target.”

Mr Hunt also announced a hike in Air Passenger Duty for people travelling in premium cabins. He said the “one-off adjustment” would be made for those with non-economy tickets, such as premium economy, business class and first class.

Tobacco duty and new vape tax

Tobacco duty will face another tax rise as the government continues its crackdown on smoking and vaping. Vaping products also face a new levy, similar to other tobacco products.

This has been done in a bid to make such products unaffordable for children.

Mr Hunt said: “To discourage non-smokers from taking up vaping, we are today confirming the introduction of an excise duty on vaping products from October ’26, and publishing a consultation on its design. Because vapes can also play a positive role in helping people quit smoking, we will introduce a one-off increase in tobacco duty at the same time to maintain the financial incentive to choose vaping over smoking.”

Holiday lettings and stamp duty

The chancellor confirmed he would abolish the furnished holiday lettings regime. He also said he would abolish stamp duty relief for those who have multiple dwellings.

He explained: “I have also been looking at the stamp duty relief for people who purchase more than one dwelling in a single transaction, known as multiple dwellings relief.” He added: ” However, an external evaluation found no strong evidence that it had done so and that it was being regularly abused. So I am going to abolish it.”

Meanwhile, he will reduce the higher rate of property capital gains tax from 28 per cent to 24 per cent.

National Insurance changes

National Insurance changes and how they affect you (Image: EXPRESS)

Abolishment of non-dom tax status

The government confirmed it will abolish the non-dom tax status. It will be replaced from April 2025 with a new residency-based system. Those who remain in the UK will pay the same tax rates as British citizens.

Mr Hunt told the Commons: “From April 2025, 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, a more generous regime than at present and one of the most attractive offers in Europe.”

“But after four years, those who continue to live in the UK will pay the same tax as other UK residents.” He added: “Recognising the contribution many of these individuals have made to our economy, we will put in place transitional arrangements for those benefitting from the current regime.”

“That will include a two-year period in which individuals will be encouraged to bring wealth earned overseas to the UK where it can be spent and invested here a measure that will attract onshore an additional £15 billion of foreign income and generate more than £1 billion of extra tax.”

“Overall abolishing non-dom status will raise £2.7 billion a year by the end of the forecast period, money the party opposite (Labour) planned to use for spending increases, but today a Conservative government makes a different choice. We use that revenue to help cut taxes on working families.”

Energy debt

The repayment period for new loans has now been increased from 12 months to 24 months which the Chancellor said will benefit those in energy debt on the lowest incomes.

Mr Hunt said: “Nearly one million households on Universal Credit take out budgeting advance loans to pay for more expensive emergencies like boiler repairs or help getting a job. To help make such loans more affordable, I have today decided to increase the repayment period for new loans from 12 months to 24 months.”

Mr Hunt said a debt relief order can cost £90, adding: “Having listened carefully to representations from Citizens Advice, I today relieve pressure on around 40,000 families every year by abolishing that £90 charge completely.”

NHS investments

A productivity plan will be introduced to benefit public services. For the NHS, it means a “full” investment to develop its IT systems and improve efficiency.

The Chancellor said the systems that support NHS staff are “often antiquated”. He added: “I wanted better care for patients, better value for taxpayers and more rewarding work for its staff. Making changes on the scale we need is not cheap. The investment needed to modernise NHS IT systems so they are as good as the best in the world costs £3.4 billion.”

“But it helps unlock £35 billion of savings, 10 times that amount. So in today’s Budget for long-term growth, I have decided to fund the NHS productivity plan in full.”

He added: “We will slash the 13 million hours lost by doctors and nurses every year to outdated IT systems. We will use AI to cut down and potentially cut in half form filling by doctors. We will digitise operating theatre processes allowing the same number of consultants to do an extra 200,000 operations a year.”

“We will fund improvements to help doctors read MRI and CT scans more accurately and quickly, speeding up results for 130,000 patients every year and saving thousands of lives, something I know would have delighted my brother Charlie who I recently lost to cancer.”

He added that the NHS will receive additional funding to help reduce waiting times. He added: “On top of funding this longer-term transformation, we will also help the NHS meet pressures in the coming year with an additional £2.5 billion. This will allow the NHS to continue its focus on reducing waiting times and brings the total increase in NHS funding since the start of the parliament to 13% in real terms.”

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