Jeremy Hunt is announcing his financial update – here are the main points, with political analysis
Politics live: latest news and reaction on UK budget plansBusiness live – autumn statement updates and analysis
Jeremy Hunt says the government will deliver a plan to tackle the cost of living crisis and rebuild the UK economy. The chancellor says his priorities are stability, growth and public services, and is providing “fair solutions” despite taking “difficult decisions”.
The chancellor says forecasts from the Office for Budget Responsibility show the economy will grow by 4.2% this year.
Hunt says the economy is already in recession, with higher energy prices explaining the majority of the revision in growth forecasts.
GDP would then shrink by 1.4% next year, before rising by 1.3% in 2024, 2.6% in 2025 and 2.7% in 2026.
In March, the OBR had forecast growth of 3.8% for 2022 and 1.8% f0r 2023.
The economy grew by 7.5% in 2021, after a fall of 11% in 2020 – the biggest decline for 300 years – during the first wave of the pandemic.
Hunt says borrowing in the current financial year, 2022-23, will be 7.1% of GDP.
In cash terms, the OBR estimates the budget deficit – the gap between spending and income – is £177bn in 2022-23.
In its previous forecasts in March, the OBR had estimated borrowing would be 3.9% of GDP, or £99.1bn in cash terms, in 2022-23.
The chancellor says borrowing is “more than halved” by the actions in the autumn statement.
Public sector net debt is forecast to peak at 97.6% of GDP in 2025-26, and then to fall gradually to 97.3% of GDP by 2027-28.
Hunt announces two new fiscal rules: underlying debt must fall as a percentage of GDP within five years; and public sector borrowing must be below 3% of GDP.
The chancellor announces a range of tax threshold freezes, including for income tax and inheritance tax for a further two years, on top of an existing four-year freeze, to April 2028
Dividend allowances will be cut. The annual exempt allowance for capital gains tax will also be cut
Hunt says the changes still leave Britain with more generous allowances than several other leading nations
The threshold for the 45p additional rate of tax will be cut from £150,000 to £125,140
Hunt says electric vehicles will no longer be exempt from vehicle excise duty from 2025
Jeremy Hunt is announcing his financial update – here are the main points, with political analysisPolitics live: latest news and reaction on UK budget plansBusiness live – autumn statement updates and analysisJeremy Hunt says the government will deliver a plan to tackle the cost of living crisis and rebuild the UK economy. The chancellor says his priorities are stability, growth and public services, and is providing “fair solutions” despite taking “difficult decisions”.The chancellor says forecasts from the Office for Budget Responsibility show the economy will grow by 4.2% this year.Hunt says the economy is already in recession, with higher energy prices explaining the majority of the revision in growth forecasts.GDP would then shrink by 1.4% next year, before rising by 1.3% in 2024, 2.6% in 2025 and 2.7% in 2026.In March, the OBR had forecast growth of 3.8% for 2022 and 1.8% f0r 2023.The economy grew by 7.5% in 2021, after a fall of 11% in 2020 – the biggest decline for 300 years – during the first wave of the pandemic.Hunt says borrowing in the current financial year, 2022-23, will be 7.1% of GDP.In cash terms, the OBR estimates the budget deficit – the gap between spending and income – is £177bn in 2022-23.In its previous forecasts in March, the OBR had estimated borrowing would be 3.9% of GDP, or £99.1bn in cash terms, in 2022-23.The chancellor says borrowing is “more than halved” by the actions in the autumn statement.Public sector net debt is forecast to peak at 97.6% of GDP in 2025-26, and then to fall gradually to 97.3% of GDP by 2027-28.Hunt announces two new fiscal rules: underlying debt must fall as a percentage of GDP within five years; and public sector borrowing must be below 3% of GDP.The chancellor announces a range of tax threshold freezes, including for income tax and inheritance tax for a further two years, on top of an existing four-year freeze, to April 2028Dividend allowances will be cut. The annual exempt allowance for capital gains tax will also be cutHunt says the changes still leave Britain with more generous allowances than several other leading nationsThe threshold for the 45p additional rate of tax will be cut from £150,000 to £125,140Hunt says electric vehicles will no longer be exempt from vehicle excise duty from 2025 Continue reading…
