BUDGET SUMMARY: Here are the key points from Chancellor Jeremy Hunt’s 2023 Budget
Chancellor Jeremy Hunt presented the 2023 Budget to the House of Commons with a primary focus on encouraging individuals who have left their jobs to re-enter the workforce and bolstering business investments. Below are the main highlights of the budget:
FUEL, ALCOHOL, PENSIONS, WAGES
Abolishing the £1.07m cap on pension savings and increasing the tax-free yearly allowance for pension pots from £40,000 to £60,000
Freezing fuel duty and extending the 5p cut on petrol and diesel fuel duty for an additional year
Implementing inflation-linked rises in alcohol taxes from August with new tax reliefs for beer, cider, and wine sold in pubs
Raising tobacco tax by 2% above inflation and hand-rolling tobacco by 6% above inflation
ENERGY BILLS, PREPAYMENT METERS, AND NUCLEAR POWER
Extending government subsidies to limit typical household energy bills to £2,500 a year for three more months until the end of June
Allocating £200m to align energy charges for prepayment meters with those for customers paying by direct debit, affecting four million households
Pledging to invest £20bn over the next two decades in low-carbon energy projects, with a focus on carbon capture and storage
Classifying nuclear energy as environmentally sustainable for investment purposes with a commitment to additional public funding
Providing £63m to assist leisure centers in dealing with increasing swimming pool heating costs and to invest in becoming more energy-efficient
CHILDCARE, UNIVERSAL CREDIT, and BACK TO WORK PLANS
Expanding the 30 hours of free childcare for working parents in England to cover one and two-year-olds
Offering £600 “incentive payments” and relaxed rules in England to increase the number of childminders
Families on universal credit will receive upfront childcare support instead of in arrears, and the £646-a-month per child cap will be raised to £951
A new fitness-to-work testing regime and a new voluntary employment scheme for disabled people in England and Wales, called Universal Support
Increased job support for lead child carers on universal credit and programmes to encourage retirees over 50 to return to work
RETIREES
Allocating £63m for “returnerships” and skills boot camps
Relaxing immigration rules for five roles in the construction sector to ease labor shortages
GOVERNMENT DEBT, INFLATION, and ECONOMIC GROWTH
Avoiding a recession in 2023, but the economy will shrink by 0.2%
Predicting a growth of 1.8% for next year, with 2.5% in 2025 and 2.1% in 2026
Expecting the UK’s inflation rate to fall to 2.9% by the end of this year, down from 10.7% in the last three months of 2022
Forecasting the underlying debt to be 92.4% of GDP this year, rising to 93.7% in 2024
CORPORATION TAX, INVESTMENT ZONES, and TAX BREAKS
Increasing the main rate of corporation tax from 19% to 25% for taxable profits over £250,000
Companies with profits between £50,000 and £250,000 will pay between 19% and 25%
Offering tax breaks and other benefits for 12 new Investment Zones across the UK, funded by £80m each over the next five years
Allowing international traders who will benefit from streamlined rules, which will reduce paperwork and give them longer to submit custom forms
OTHER MEASURES
The government has announced that defence spending will be raised by £11bn over the next five years.
Individuals found guilty of marketing tax aviodance schemes will now face prison sentences
The government will allocate £200m this year to assist local councils in England with the repair of potholes
An additional £10m will be allocated over the next two years to charities in England to help prevent suicide
A new streamlined approvales process will be implemented for medical products, and £900m will be provided for a new supercomputer facility to assist the UK’s AI industry.
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