When it’s a Spring Statement of course. There weren’t many rabbits being let out the bag in Rishi Sunak’s House of Commons speech. However, there was some good news for motorists. And an unexpected commitment to cutting income tax at a later date.
Unsurprisingly, the impact of supporting Ukraine during the current conflict was the context for the Chancellor’s speech. Rishi made reference to global pressures, particularly around the energy supply chain and market uncertainty.
The main announcements in the Spring Statement were the cutting of fuel duty, raising of the threshold at which people start paying National Insurance, and a pledge to cut the basic rate of income tax before the next general election.
Fuel duty will be cut by 5p per litre until March 2023. Coming into effect from 6pm on 23 March, Spring Statement day.
Homeowners installing energy efficiency materials such as solar panels, heat pumps, or insulation will see VAT cut on these items from 5% to zero for the next five years.
The income threshold at which point people start paying National Insurance will rise to £12,570 in July, which Rishi said was tax cut for employees worth over £330 a year.
The Chancellor did also reference publication of a new Tax Plan. Far glossier than the usual Budget documentation put out by the Treasury. Take a look here.
Reform in the Autumn of the R&D tax credits regime was also referenced. There were limited details but the Chancellor did say he will work with businesses, ahead of introducing the changes in the Autumn Budget. No doubt a further consultation is to be expected in the Summer.
If you’d like to read the full Spring Statement you’ll find it here.
