IN a bid to save the British economy, Jeremy Hunt will reveal the government’s highly anticipated Autumn Budget on November 17.
The event will have a massive effect on Brits, especially as the cost of living crisis continues to crunch household finances.
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The Chancellor will use the Autumn Budget to plug a whopping £50bn gap in the public purse.
The hole came about due to a mix of the Covid pandemic, soaring inflation, Mad Vlad Putin’s war in Ukraine and Liz Truss’ disastrous mini budget.
To fill the hole, Mr Hunt will announce a combination of spending cuts and tax rises.
Rishi Sunak has warned the public to prepare for “difficult decisions” ahead.
But the PM also said he’ll do whatever he can to help hard-up Brits, and vowed to put the needs of the most vulnerable first.
Here’s what the Autumn Budget COULD entail so far, and how much it will affect your wallet out of 5.
STEALTH TAX: 5/5
Mr Hunt is considering extending a freeze on income tax thresholds until 2028 – dragging millions more into a higher rate of tax.
The freeze was originally supposed to end in 2026.
By extending it, Brits who earn over £50,000 a year could end up paying £3,659 more in tax overall.
A stealth tax is form a tax collected in a way that isn’t obvious – and you might not even notice it.
While the government doesn’t change the headline tax rate, you end up paying more money.
That’s because while salaries rise, the tax threshold stays the same, and so you get dragged into paying higher rates.
Tax thresholds would usually be tweaked to take into account inflation and rises in earnings.
WINDFALL TAX: 1/5
Mr Hunt is eyeing a fresh windfall tax grab on the eye-watering profits being made by energy giants.
The PM himself introduced the current 25 per cent levy as Chancellor to raise £7billion this year and £10billion next year.
Demands for a deeper levy flared last week as Shell posted profits of £8billion for just the last three months.
The Sun understands that the Treasury wants to raise the windfall tax by five points to 30 per cent.
AXING TRIPLE LOCK: 4/5
Millions of pensioners could lose out on promised cash as Mr Hunt and Mr Sunak have refused to commit to the pension triple lock.
The popular triple lock sees pension payments increase in line with whichever of the following is highest:
- Earnings – the average percentage growth in wages in Great Britain
- Prices – the rising cost of living in the UK, as measured by the Consumer Prices Index (CPI)
- 2.5%
Mr Hunt could decide that pensions should only rise in line with earnings rather than the current 10.1 per cent inflation rate.
This would save the Treasury around £7bn.
BENEFITS CUTS: 5/5
The Chancellor is still weighing up whether to uprate benefits in line with inflation next April.
Mr Hunt could decide to uprate the likes of Universal Credit in line with earnings instead.
The move would save around £5bn but politically is very risky.
Many Tory MPs have called for benefits and inflation to stay aligned, and Mr Sunak promised this himself when he was Chancellor earlier in the year.
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REINSTATE NICS HIKE: 3/5
Reinstating the original 1.25 per cent National Insurance hike would raise £13bn.
But it would hit workers and could prove unpopular with MPs.
Boris Johnson brought in the hike early this year to fund NHS backlogs and social care.
But Liz Truss reversed it during her short stint as PM, arguing it was bad for growth.
HIKE FUEL DUTY: 4/5
Motorists benefited from a 5p per litre cut for petrol and diesel cars earlier this year.
But the 12-month measure only lasts until the end of March.
The cut — introduced by Mr Sunak as Chancellor in the wake of The Sun’s Keep It Down campaign — is worth around £5billion to hard-working families and businesses.
Tory MPs have warned Mr Hunt against hitting hard-up Brits where it hurts by increasing the duty again.
This post first appeared on thesun.co.uk
