In the latest budget announcement, UK Chancellor Jeremy Hunt has introduced measures aimed at encouraging long-term growth and offering permanent tax cuts. National Insurance will be reduced, Child Benefit thresholds increased, and fuel and alcohol duties frozen. The budget, which could be the last before the general election, also includes a new tax on vaping products and an extension to the windfall tax on energy firms. The Office for Budget Responsibility forecasts economic growth and a decrease in inflation, although debt as a percentage of GDP is expected to rise.
- UK Chancellor Jeremy Hunt has delivered what may be the last budget before the general election.
- National Insurance will be cut by two pence in the pound, starting next month.
- The earning threshold for Child Benefit has been raised from £50,000 to £60,000.
- Fuel duty has been frozen again, with a continuation of the 5p cut for another year.
- Alcohol Duty freeze has been extended until February next year.
- Emergency budgeting loans for people on benefits will have a longer repayment period.
- The VAT threshold for small businesses has increased from £85,000 to £90,000.
- A new tax on vaping products will be introduced in October 2026.
- The existing tobacco tax will increase to maintain the financial incentive to choose vaping over smoking.
- The windfall tax on energy firms’ profits has been extended until 2029.
- Air passenger Duty on business class tickets will increase.
- The non-dom tax regime will be replaced with new rules from April 2025.
- The UK’s economy is expected to grow by 0.8% this year and 1.9% next year.
- Inflation is forecast to fall below the 2% target this year.
- UK’s underlying debt is forecast to be 91.7% of GDP this year and rise to 92.8% next year.
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