Today, Chancellor Jeremy Hunt has announced a range of tax and spending plans as part of the Government’s Autumn Statement.
We share a rundown of some of the key plans outlined earlier:
Minimum Wage to Rise
- The National Living Wage is set to increase from £10.42 to £11.44 per hour from April 2024.
- This represents a rise of 9.8% and can be worth up to £1,800 extra per year for a full-time worker – what Chancellor Jeremy Hunt has referred to as “the largest ever cash increase” in the National Living Wage.
Benefits to Increase
- Benefits will increase next year by 6.7%, which is the inflation rate for September. This applies across working-age benefits such as Universal Credit and disability benefits.
State Pension to Increase
- The Government will increase the state pension by 8.5% to £221.20 a week, worth up to £900 more a year from April 2024.
- The Chancellor will also begin consulting on further pension reforms, including a proposal to give ‘one pension pot for life’ which involves giving pension savers the legal right that their employer pays contributions into their existing pension – with the Government estimating that this could unlock an extra £1,000 a year for the average earner saving from the age of 18.
National Insurance Reductions
- The National Insurance rate cut from 12% to 10% from 6th January 2024.
- ‘Class 2’ National Insurance rates for self-employed people earning above £12,570 will be abolished, saving £192 a year for the average self-employed person.
- There will be savings for self-employed people paying ‘Class 4’ National Insurance (earning between £12,570 – £50,270) as the rate is being cut by 1% down to 8% from April 2024.
Business Rate Relief Extended
- The 75% discount on business rates up to £110,000 discount for retail hospitality and leisure businesses will be extended for another year, and the Government will freeze the small business multiplier for a further year.
- Chancellor Jeremy Hunt says these measures will save the average independent shop over £20,000 and the average independent pub over £12,800 next year.
Clean Energy Plans
- The Government has pledged reform for the time it takes for clean energy businesses to access the electricity grid by 90%. As part of these plans there will also be measures to enable discounts of up to £10,000 off electricity bills over 10 years for those living closest to new transmission infrastructure.
Local Housing Allowance Rises
- The Local Housing Allowance will rise to £800 next year, helping out over 1.6m households next year. This is designed to help people on benefits to pay their rent to a private landlord, and has previously been frozen since 2020, despite rents rising sharply.
Additional Announcements
- There will be a further rise to Tobacco Duty – with an extra 10% increase applied to hand-rolled tobacco, above the existing tobacco duty escalator. Meanwhile, alcohol duty remains unchanged until at least 1st August 2024.
- An additional £4.5bn has been pledged to be invested into manufacturing by 2030, including support for aerospace firms, life sciences and new green industry firms.
- The Government will invest £500m into new ‘innovation centres’ across the UK to make the country an “AI powerhouse” across the next two years.
Source: BBC (2023) Live Autumn Statement. Available at: https://www.bbc.co.uk/news/live/uk-67491863 (Accessed 22nd Nov 2023)
