Budget News

Budget 2017 – Key Points

The UK Economy 

  • Growth forecast for 2017 downgraded from 2% to 1.5%
  • GDP downgraded to 1.4%, 1.3% and 1.5% in subsequent years before rising to 1.6% in 2021-22
  • Productivity growth and business investment also revised down
  • Annual rate of CPI inflation forecast to fall from peak of 3% towards 2% target later this year
  • Another 600,000 people forecast to be in work by 2022
  • £3bn to be set aside over next two years to prepare UK for every possible outcome as UK leaves EU

Personal Taxation and Wages

  • Tax-free personal allowance on income tax to rise to £11,850 in April 2018
  • Higher-rate tax threshold to increase to £46,350
  • Short-haul air passenger duty rates and long-haul economy rates to be frozen, paid for by an increase on premium-class tickets and on private jets
  • National Living Wage to rise in April 2018 by 4.4%, from £7.50 an hour to £7.83.

Business 

  • VAT threshold for small business to remain at £85,000 for two years
  • £500m support for 5G mobile networks, full fibre broadband and artificial intelligence
  • £540m to support the growth of electric cars, including more charging points
  • A further £2.3bn allocated for investment in research and development
  • Rises in business rates to be pegged to CPI measure of inflation, not higher RPI, a cut of £2.3bn
  • £30m to develop digital skills distance learning courses

Stamp Duty and Housing

  • Stamp duty to be abolished immediately for first-time buyers purchasing properties worth up to £300,000
  • To help those in London and other expensive areas, the first £300,000 of the cost of a £500,000 purchase by all first-time buyers will be exempt from stamp duty, with the remaining £200,000 incurring 5%.
  • 95% of all first-time buyers will benefit, with 80% not paying stamp duty
  • Reduction will apply immediately in England, Wales and Northern Ireland although the Welsh government will have to decide whether to continue it when stamp duty is devolved in April 2018
  • It will not apply in Scotland unless Scottish government decides to follow suit
  • £44bn in overall government support for housing to meet target of building 300,000 new homes a year by the middle of the next decade
  • Councils given powers to charge 100% council tax premium on empty properties
  • Compulsory purchase of land banked by developers for financial reasons
  • £400m to regenerate housing estates and £1.1bn to unlock strategic sites for development
  • Review into delays in developments given planning permission being taken forward
  • £28m for Kensington and Chelsea council to provide counselling services and mental health support for victims of the Grenfell fire and for regeneration of surrounding area
  • New homelessness task force
Posted in Budget News, News