Autumn Statement 2023 Key Announcements

Autumn Statement 2023

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The Chancellor, Jeremy Hunt has set out his “autumn statement for growth” as he seeks to support workers, businesses, and the economy.

Encouraged by the Government’s achievement of halving inflation by the year-end (currently 4.6%) he said, “Our strategy for the British economy is clearly yielding results, yet there is more work to be done.

Our full summary of the Autumn Statement will be live soon, for now, the key announcements include:

  • National Insurance Cut: The Chancellor announced a 2% reduction in national insurance contributions for 27 million workers, effective from January 2024. Workers earning up to £50,000 will benefit from a reduction in their national insurance rate from 12% to 10%, translating to a saving of over £450 a year for someone with an average salary of £35,000
  • Living Wage Increase: The minimum wage, officially known as the National Living Wage, will rise from £10.42 to £11.44 per hour from April 2024. This increase applies to workers aged 21 and 22 for the first time, and 18 to 20-year-olds will also see a rise to £8.60 per hour​
  • Benefits and State Pension: Universal Credit and other benefits will increase by 6.7%, in line with September’s inflation figure. The state pension will rise by 8.5% from April, adhering to the triple-lock commitment. This increase could be worth up to £900 a year for pensioners
  • Self-Employed Tax Cuts: Class 2 national insurance contributions for the self-employed have been abolished, saving an average of £192 per worker annually. Additionally, class 4 contributions are reduced from 9% to 8%, potentially saving self-employed individuals an average of £350 a year
  • Business Investment Tax Break: The Chancellor extended the temporary tax break known as “full expensing,” allowing businesses to offset investments against tax, now made permanent. This is expected to be a significant tax relief for businesses
  • Alcohol Duty Freeze: Alcohol duty has been frozen until at least August 2024, under pressure from the hospitality industry. This freeze includes a special rate for pints in pubs, known as the Brexit pubs guarantee
  • Green Technology Investment: The budget commits £4.5 billion to green technology to support the UK’s transition to net zero. This includes a significant allocation for the car industry and financial incentives for communities hosting energy infrastructure projects
  • Housing and Planning Measures: Local authorities will be able to fully recover the costs of planning applications to address backlogs. The government also plans to allow houses to be converted into two flats
  • No Inheritance Tax Cut: Contrary to expectations, the Chancellor did not cut inheritance tax, postponing any potential changes until at least next spring
  • No Change to Income Tax: Despite speculation, there was no cut to income tax rates. Instead, the focus was on reducing national insurance contributions
  • Economic Projections and Support for Businesses: The Office for Budget Responsibility forecasts that inflation will drop to 2.8% by the end of 2024, and the UK economy is expected to grow slightly in the next two years. The budget introduced measures to support business investment and employment, including extending business rates relief and freezing the small business multiplier for another year

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