The Chancellor delivered his first Spring statement, which is set to be the start of a new fiscal reporting process, with any major tax or spending changes to be announced in an annual Budget be delivered in the Autumn. Our Tax Manager, Gary Hughes summarises the key changes.
Economy and Fiscal Forecasts:
- The economy continues to grow, continues to create jobs and continues to beat expectations
- Employment has increased by 3 million since 2010, which is the equivalent of 1,000 people finding work every day
- Unemployment is close to a 40-year low
- The UK’s public finances have reached a turning point, with borrowing down and the first sustained fall in debt for 17 years
- Borrowing has fallen by three-quarters since 2010. In 2009-10 the UK borrowed £1 in every £4 that was spent. The OBR expect that we will borrow £1 in every £18 this year
- Debt will start falling as a share of GDP next year
Progress Since Autumn Budget 2017:
- Over £1.5 billion allocated to departments and devolved administrations to prepare for Brexit in 2018-19. This is part of the £3 billion to be spent over two years announced at Autumn Budget 2017.
Plan to tackle the UK’s Housing Challenge and Build New Homes:
- An investment programme of at least £44 billion over the next five years was announced at Autumn Budget 2017, putting the Government on track to raise the supply of homes to 300,000 a year on average by the mid-2020s.
Helping households with the cost of living
- In April 2018 the National Living Wage will rise to £7.83, worth £600 extra a year for a full-time worker.
- National Minimum Wage rates for under 25s and apprentices will also rise.
- The personal allowance will rise to £11,850 from April 2018.
Helping businesses by bringing forward the next business rates revaluation to 2021
At Autumn Budget 2017 it was announced that business rates revaluations will take place every three years, rather than every five years, following the next revaluation. This makes bills more accurately reflect the current rental value of properties. Spring Statement 2018 announces that the next revaluation, currently due in 2022, will be brought forward to 2021. This will mean businesses can benefit from the change to three-year revaluations earlier, with the first taking place in 2024.
Reducing single-use plastic waste through the tax system
The government will seek views on how best to use the tax system to encourage the responsible use of plastic. Some of the money raised from any tax changes will be used to encourage the creation of new, greener products and services.
How Hallidays can help
If you’d like any support with your tax planning please contact our specialist tax experts on 0161 476 8276, email firstname.lastname@example.org or visit www.hallidays.co.uk/services/taxation to learn more about how we can help.
Posted 14th March 2018