+Spring Statement Announcement Live Blog+

Stay tuned…

Security

  • Moral responsibility to use economic strength to support Ukraine and impose severe costs on Putin’s regime
  • Putin sanctions not cost-free to UK and presents risk to our recovery

Outlook

  • OBR has said there is “unusually high uncertainty around our economic output.”
  • OBR now forecasts growth this year of 3.8%, then 1.8% next year, followed by 2.1%.
  • Lower growth outlook hasn’t affected jobs performance with unemployment forecast to be lower in every year of the forecast
  • OBR expect inflation to rise further, averaging 7.4% this year

Energy

  • Three immediate measures:
    • Fuel duty cut by 5p per litre, biggest cut to fuel duty rates ever
      • Cut will last until March next year
      • Worth over £5 billion, taking effect from tonight
    • VAT cut on homeowners installing energy-saving materials will now pay 0 VAT, something we can only do thanks to Brexit.
      • All energy red tape abolished
      • Solar panel installation will now be £1,000 cheaper
      • Won’t be able to sanction this in Northern Ireland thanks to the protocol, Barnett relief will be sent to Stormont instead
    • Doubling household support fund
      • Will receive this funding from April

Fiscal rules

  • Rishi still meeting his fiscal rules with the above announcements. Borrowing as percentage of GDP still falling.
  • Cost of borrowing continuing to rise
    • £83 billion of debt interest payments next year, 4 times that of last years
  • Treasury will continue to weigh carefully calls for more public spending

Cost of living/tax

  • Overarching ambition to reduce taxes by end of this parliament
  • Tax plan published today – “principled approach” 
  • Any extra resources to go on lower taxes not extra spending
  • NI Rise:
    • If the rise goes, so does the £12 billion NHS funding
    • Right that the Health & Care Levy stays
    • Not incompatible with reducing taxes
    • NI threshold currently £9,900 – current plan to increase by £300 but Rishi instead to increase it by the full £3,000, fully equalising the NI and Tax threshold
    • From this July £12,570 earners won’t pay a penny in NI
    • £6 billion tax cut
    • £330 a year tax cut for workers
  • Rishi will review whether current tax system is incentivising training
  • R&D is too low as a percentage of GDP, will expand relief
  • Employment allowance increased to £5,000, help for small businesses
  • Rishi refuses to let ambition of income tax cut “dither and drift”
    • Rishi confirms that before the end of this parliament, 2024, basic rate of income tax will be cut by 20p to 19p in the pound
    • A £5 billion tax cut for 30 million people

Rishi claims this tax plan represents the biggest cut to taxes for a quarter of a century and surprisingly commends it to the house…

mdi-tag-outline Spring Statement
mdi-account-multiple-outline Rishi Sunak
mdi-timer March 23 2022 @ 12:42 mdi-share-variant mdi-twitter mdi-facebook mdi-whatsapp mdi-telegram mdi-linkedin mdi-email mdi-printer
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