Spring Statement 2022
/Did you listen to the Spring Statement 2022 on Wednesday 23rd March?
Fear not, we’ve summarised the key points beneath.
Fuel duty cut
A 5p cut in fuel duty from 6pm on Weds 23rd March was announced.
Critics say that the Chancellor could have gone further with this cut as, since the fuel price increase, the Government are receiving much more in VAT from fuel and so even with the 5p cut, they will still be earning more from fuel than they were before the increase
Others also question how this cut sits with the UK’s long term sustainability plans.
Income tax, national insurance and Employment allowance
The chancellor announced three measures relating to employees & the self employed:
First is an increase in the employment allowance from £4k to £5k from April 22. This will help eligible employers who will not pay the first £5k of employers NI.
Second was the rise in the National insurance threshold for employees to £12,570 from July 22. For the self employed, an increase to £11,908 for the 22/23 year takes place to match the employed split rate.
Third was the announcement regarding an income tax to drop from 20% to 19% by 2024.
Energy Saving Equipment VAT rate
Households purchasing energy saving equipment, such as solar panels or heat pumps, will attract a VAT rate of 0% instead of 5%.
Household support fund
Household support fund doubled to £1bn, this will be used by councils to support vulnerable households.
To be announced in the Autumn budget - People, Capital, Ideas:
The chancellor also summarised the 3 areas that businesses will be consulted on in the run up to the Autumn budget:
People - Consider current staff training incentives such as apprenticeship schemes
Capital - Capital investment incentives review
Ideas - Reform of R&D tax credits
So overall, some good points to help individuals but not much for businesses. The chancellor has been criticised that the announcements don’t tackle the rise in the cost of living crisis. What are your thoughts?
