Here is your at-a-glance guide to the main points in the spring statement delivered by Chancellor Rishi Sunak to the House of Commons on Wednesday:
- Income threshold for at which point people start paying National Insurance will rise to £12,570 in July, a tax cut for employees worth more than £330 a year.
- Basic rate of income tax to be cut from from 20p to 19p in the pound before the end of this Parliament.
- The Employment Allowance, which gives relief to smaller businesses’ National Insurance payments, will increase from £4,000 to £5,000 from April.
Energy and living costs
- Fuel duty will be cut by 5p per litre until March 2023.
- Homeowners installing green energy materials such as solar panels, heat pumps, or insulation installed will see VAT cut from 5% to zero for five years.
- Local authorities will receive an extra £500m for the Household Support Fund from April, creating a £1bn fund to help vulnerable households with rising living costs.
- Office for Budget Responsibility says the UK economy is forecast to grow by 3.8% this year, according to the, a sharp cut from its previous prediction of 6%.
- The economy is then forecast to grow by 1.8% in 2023 and 2.1% in 2024.
- Annual inflation rate was 6.2% in February, and is likely to average 7.4% for the rest of this year, but with peak of 8.7% in the final quarter of 2022.
- Unemployment rate, which is currently at 3.9%, is now predicted to be lower in every year of the OBR’s forecast.
- Number of people employed between now and 2027 is expected to be 400,000 lower than before the pandemic. This is because of early retirements, long-term sickness and fewer workers arriving in the UK.
- Borrowing as a percentage of GDP is expected to fall from 83.5% of GDP in 2022/23 to 79.8% in 2026/27.
- Government is forecast to spend £83bn on debt interest in the next financial year, the highest on record.