Chancellor Jeremy Hunt says Government’s priorities are ‘stability, growth and public services and to protect the vulnerable’ as he delivered the Autumn statement.
He announced a £55 billion package of consolidation measures with tax rises and spending cuts in order to stabilise the public finances, reduce debt and combat high inflation and high interest rates and rebuild the economy. The following areas of the Chancellor’s Statement will be of interest to members:
Taxation and wages – national living wage to increase
- Income tax personal allowance and higher rate thresholds frozen for further two years, until April 2028
- National Insurance and inheritance tax thresholds frozen for further two years, until April 2028
- UK minimum wage for people over 23 to increase from £9.50 to £10.42 an hour from April 2023
- Tax-free allowances for dividend and capital gains tax cut next year and in 2024
Business rates support
A package of targeted support of £13.6 billion over the next five years is intended to help business with rates. HM Treasury published a full Business Rates Factsheet which goes into detail.
Ratepayers in England will also be able to see the future rateable value for their property and get an estimate of what their business rates bill may be from 1 April 2023 at https://www.gov.uk/find-business-rates.
Energy Bill Relief Scheme review – more targeted support for businesses
For businesses, the Chancellor mentioned there would be support coming on energy in 2023 but did not clarify the detail. The Government is currently conducting a review of The Government’s Energy Bill Relief Scheme (EBRS) for businesses, with the scheme due to end on 31March 2023.
The support the EBRS will provide for businesses after this date will be ‘significantly lower, and targeted at those most affected to ensure fiscal sustainability and value for money for the taxpayer’. The Government review of the Scheme underway states there will be a ‘very high bar’ for firms to receive continued government support.
Read more at Terms of Reference: Review of the EBRS. To make a case directly, businesses should email ebrsreview@beis.gov.uk as soon as possible, as results are expected before Christmas.
Electric vehicles no longer exempt from VED from April 2025
Half of all new vehicles will be electric by 2025 and to make the ‘motoring tax system fairer’, electric vehicles will no longer be exempt from Vehicle Excise Duty. The Chancellor also announced:
- company car tax rates for electric vehicles will remain lower than for traditionally fuelled vehicles.
- the exemption for electric cars from the expensive car supplement has also been removed.