Some may remember that last year’s Autumn Budget was shelved as a result of the problems caused by the Covid-19 pandemic. Although Covid-19 is still very much posing problems, the Government has decided to go ahead with this year’s Autumn Budget and set out its long term spending plans.
Prior to setting out the Government’s plans in the Budget, the Chancellor of the Exchequer set out a generally positive position on the UK economy, hammering home the phrase “jobs up, growth up and debt down”.
We have outlined the key takeaways from this year’s Autumn Budget below:
- The Government is pushing ahead with the Residential Property Developer Tax, whereby developers with profits over £25 million will be taxed at a rate of 4% to help fund the removal of unsafe cladding.
- On business rates, there will be a new 50% discount for the hospitality, entertainment and leisure sector up to a maximum of £110,000 for one year. The multiplier increase planned for 2022 will also be cancelled to help save money for businesses.
- The Government is introducing a relief on tonnage tax (which covers shipping) by rewarding those who adopt the UK shipping flag.
- From April 2023, air passenger duty for domestic UK flights will be reduced with approximately 9 million seeing duty cut by half. A new ultra-long haul tax band (for flights over 5,500 miles) will be introduced to account for the reduction in air passenger duty.
- Alcohol duty will be simplified so that “the stronger the drink the higher the rate” of the tax. The planned increase in duty on alcohol will also be cancelled and there will be a 5% cut to duty on draught beer and cider.
- The planned rise in fuel duty will be cancelled, saving almost £8 billion. It will remain at 57.95p a litre until next year.
Business and employment
- The Government is pushing its “plan for jobs” – having already announced funding of £500 million to help people back into work (careers help and funding for apprenticeships).
- The National Living Wage for over 23 year olds will rise 6.6% from £8.91 to £9.50 (benefiting over 2 million of the lowest paid in the country). This change will come into effect in April 2022.
- The Government has stated it is keen to retain the target to increase spending on research and development to £22 billion, with a focus on this being carried out in the UK.
- It will also look to introduce a “scale up visa”, making it quicker and easier to bring in highly skilled individuals in the science and technological fields.
- For housing, the Government will set aside £11.5 billion to build 180,000 new affordable homes (targeting brownfield sites for development).
Education and childcare
- The Government will provide a further £2 billion to schools to support their recovery from the Covid-19 pandemic.
- It has also promised £300 million for a “Start for Life” offer for families, high-quality parenting programmes, tailored services to help with perinatal mental health, and funding to create a network of family hubs.
Arts and sport
- The Government will provide £205 million in funding to help build around 8000 state of the art community sports pitches.
- In addition, tax reliefs will be doubled for those businesses in the culture sector until March 2024.
- The Government will provide an extra £2.2 billion for courts to help cover the backlog in the criminal justice system.
- It will also spend £3.8 billion on more prisons and provide additional funding for the recruitment of 20,000 police officers.
As always, Leathes Prior will be quick to comment on any issues (such as this year’s Autumn Budget) which may have legal or commercial implications for your business, so please do follow our social media (LinkedIn, Twitter, Facebook and Instagram) for the latest updates.
Note: The content of this article is for general information only and does not constitute legal advice. Specific legal advice should be taken in any particular circumstance. If you have any questions about the content of this article, or how the Budget might affect your business, please call the Corporate and Commercial and/or Employment Teams on 01603 610911.