PLEASE NOTE: This snapshot is not intended as an in-depth analysis of the Chancellor’s speech, but we hope this brief summary helps you gain a quick grasp on the key points delivered by the Chancellor from the Dispatch box.
- The Chancellor announced adjustments to previous growth forecasts from those previously announced in the 2015 Autumn Statement & Spending Review.
- Growth forecast for 2016 – revised down from 2.4% to 2.0%
- Growth forecast for 2017 – revised down from 2.5% to 2.2%
- OBR borrowing forecast revised up from £49.9bn to £55.5bn for 2016/17 (taking account of new statistical data) / borrowing forecast at £38.8bn in 2017/18
- OBR states national debt now 82.6% of GDP (taking account of new statistical data) for 2016/17
- OBR forecasts lower inflation for 2016 (1% down to 0.7%) and 2017 (1.8% down to 1.6% )
- OBR says an EU ‘Leave’ vote could usher in an extended period of uncertainty
Taxation / Welfare / Finance
- Personal allowance to rise to £11,500 from 2017
- Higher rate of tax threshold to increase to £45,000 from 2017
- ISA limit increase from 2017 to £20,000
- Lifetime ISA to be introduced – Available to those under age 40 from April 2017 – save up to £4,000 each year and Government will give £1 for every £4 saved – An alternative to pension contributions. Help to Buy ISA can be rolled into the Lifetime ISA
- New rules to be introduced for large corporate multi-nationals in an attempt to ensure companies pay appropriate tax.
- New rules to prevent offshore companies storing goods in the UK but selling online and not paying VAT.
- Corporation Tax to be cut to 17% by April 2020
- Small business rate relief thresholds to be more than doubled
- Commercial stamp duty to have a 0% rate up to £150,000 (other additional bands apply and come into effect from midnight on 16th March)
- Supplementary charge on oil and gas cut by half to 10%
- Standard rate of Insurance Premium Tax to be increased by 0.5%
- Class 2 NI contributions to be removed
- Capital Gains Tax to be cut to 20% in certain circumstances
Education / Child Welfare
- Extra funding committed so that by 2020 all primary and secondary schools will be, or will be in the process of becoming, an Academy
- New white paper to follow shortly with further education initiatives
- Sugar Levy to be introduced on soft drinks industry. To be introduced in 2 years’ time to allow companies time to amend content of their products.
- ‘Sugar Tax’ to be redirected to encouraging sport participation in primary schools
- Libor funds to be directed towards children hospital care
- Fuel duty frozen for sixth year in a row
- Beer duty and cider duty frozen
- Duty frozen on Whiskey and other spirits
- Tobacco duty to rise by 2% above inflation from 16th March
Transport / Infrastructure
- HS 3 and other major projects to be implemented across the Northern Powerhouse
- Government will commission Crossrail 2 for London
- More support for flood defences
- More devolution to be introduced, giving more responsibility to Scotland, Wales & Northern Ireland
- More devolution for Northern Powerhouses to include election of mayors and a handover of certain responsibilities to local control, including new justice powers for Greater Manchester.
- South West of England initiative to assist young house buyers in the area
- £150m package to reduce homelessness and rough sleeping