Autumn Budget 2021

Taxation, Wages & Reliefs

  • Universal Credit taper rate will be cut by 8% no later than 1 December, bringing it down from 63% to 55% – allowing claimants to keep more of the payment.
  • A 50% business rates discount for the retail, hospitality, and leisure sectors in England in 2022-23, up to a maximum of £110,000.
  • Planned rise in fuel duty to be cancelled amid the highest pump prices in eight years.
  • The £1m Annual Investment allowance was extended from the end of the year to March 2023.
  • From 1 April 2023 the rate of the corporation tax banking surcharge will reduce from 8 per cent to 3 per cent, at the same time that the main rate of corporation tax increases from 19 per cent to 25 per cent. The effective rate of corporation tax paid by banking companies will increase broadly from 27 percent to 28 percent. 
  • National Living Wage to increase next year by 6.6%, to £9.50 an hour for 23 years and over. Minimum wages also increasing under 22.

Minimum wages for other age ranges will increase as follows:

21 to 22 year olds:  from £8.36 to £9.18 per hour

18 to 20 year olds: from £6.56 to £6.83 per hour

16 to 17 year olds: from £4.62 to £4.81 per hour A

Apprentices: from £4.30 to £4.81 per hour.

 

Investment and skills  

  • Mr Sunak confirmed that £1.4bn will be set aside for a Global Britain Investment Fund to help lure in foreign investment. The British Business Bank’s regional financing programmes will be increased to £1.6bn.
  • The Chancellor expanded R&D tax credits to help encourage investment in cloud computing and data costs. He added he will look at ensuring investment from the tax break is spent in the UK rather than overseas.
  • The Treasury is increasing spending on boosting skills by £3.8bn over this Parliament, a 38pc rise. It will include a £560m Multiply programme to improve adults’ basic math skills

 

State of the Economy and Public finances

  • Inflation in September was 3.1% and is likely to rise to average 4% over next year, OBR says
  • UK economy forecast to return to pre-Covid levels by 2022
  • Annual growth set to rebound by 6.5% this year, followed by 6% in 2022
  • Wages have grown in real terms by 3.4% since February 2020
  • Borrowing as a percentage of GDP is forecast to fall from 7.9% this year to 3.3% next year
  • Foreign aid spending projected to return to 0.7% of GDP by 2024-25

Government spending 

  • Whitehall departments to receive rise in overall spending, totalling £150bn over the course of this Parliament
  • Funding will rise by an average of £4.6bn for Scottish Government, £2.5bn for Welsh Government, and £1.6bn for Northern Ireland Executive
  • Levelling Up Fund will mean £1.7bn invested in local areas across the UK
  • Government backing projects in Aberdeen, Bury, Burnley, Lewes, Clwyd South, Stoke-on-Trent, Ashton under Lyne, Doncaster, South Leicester, Sunderland and West Leeds
  • Extra £2.2bn for courts, prisons and probation services, including funding to clear the courts backlog
  • Tax relief for museums and galleries will be extended for two years, to March 2024
  • Core science funding to rise to £5.9bn a year by 2024-25
  • £6bn of funding to help tackle NHS backlogs
  • £7bn for transport projects in areas including Greater Manchester, the West Midlands and South Yorkshire

Children and Education 

  • Schools to get an extra £4.7bn by 2024-25
  • There will be nearly £2bn of new funding to help schools and colleges to recover from the pandemic
  • Schools funding to return to 2010 levels in real terms – an equivalent per pupil cash increase of more than £1,500
  • £300m will be spent on a “Start for Life” parenting programmes, with an additional £170m by 2024-25 promised for childcare
  • A UK-wide numeracy programme will be set-up to help improve basic math skills among adults

Air travel 

  • Flights between airports in the UK nations will be subject to a new lower rate of Air Passenger Duty from April 2023
  • Financial support for English airports to be extended for a further six months

Housing 

  • £24bn earmarked for housing, including £11.5bn for up to 180,000 affordable homes, with brownfield sites targeted for development
  • 4% levy will be placed on property developers with profits over £25m to help create a £5bn fund to remove unsafe cladding
  • £640m a year to address rough sleeping and homelessness

Theatres & Galleries: Tax Relief 

  • Tax relief worth £250m will be made available to theatres, galleries and other cultural organisations from April 2023 to help them recover from the pandemic

Alcohol 

  • Planned rise in the duty on spirits, wine, cider and beer cancelled
  • Simplification of alcohol duties will see the number of rates drop from 15 to six
  • Stronger red wines, fortified wines, and high-strength ciders will see a small increase in their rates
  • Rates on many lower alcohol drinks including rose wine, fruit ciders, liqueurs, lower strength beers and wines to fall
  • All sparkling wines to pay same duty as still wines of equivalent strength
  • Lower duty on draught beer and cider from containers over 40 liters will cut the rate by 5%

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