MILLIONS of Brits will receive a boost to their bank accounts as Jeremy Hunt today announced tax cuts and benefit hikes to get Britain “back on track”.
Mr Hunt vowed to “reduce debt, cut taxes and reward work” as he unveiled a package aimed at saving cash-strapped Brits and turbo-charging the economy.
7
He slashed National Insurance, boosted Universal Credit benefits and put up the minimum wage.
But in a surprise twist, he also hiked hand rolled tobacco tax – with almost immediate effect – and warned benefits’ Brits they should find a job within two years or face losing state handouts.
In his Autumn Statement Jeremy Hunt announced:
In today’s Tory make-or-break Autumn Statement, the Chancellor cut National Insurance by two percentage points from 12% to 10%.
The cut will impact 27 million Brits and will enable a worker on the average salary of £35,000 to save over £450.
A senior nurse with five years of experience on £42,618 will receive an annual gain of £600, the Treasury said.
And an average full-time nurse on £38,900 will receive an yearly boost of over £520.
Most read in Money
7
Tomorrow emergency legislation will be introduced so the major change to tax can come into effect on January 6 next year.
Meanwhile, the lowest paid workers saw the minimum wage hiked to £11.44.
That’s a pay rise of more than a quid for more than three million Brits.
Ahead of Christmas party season the Chancellor brought joy to boozers as he announced alcohol duty will stay frozen.
In a major victory for our Save Our Sups campaign, beer, wine and spirits levies will not go up – and pubs and bars had their 75 per cent business rates holiday extended.
As MPs cheered the freeze in the Commons, Mr Hunt said: “I know that for many people going to the pub has become more expensive.
“I have listened closely to the persuasive arguments on alcohol duties from (colleagues) and indeed The Sun newspaper.”
While drinkers cheered, smokers suffered a major blow as the Chancellor hiked taxes on hand-rolled tobacco by 10%.
The price of a pack of cigarettes will also shoot up under a 2% regular inflation rise.
Once dubbed Scrooge for his miserly handling of the public purse, the Chancellor used better than expected borrowing numbers to finally ease the pain on punters’ wallets.
After three years of festive trade blighted by Covid and then strikes, the move kick started the Christmas party season as the Tories desperately try to turn their dire poll ratings around.
7
Mr Hunt said: “In today’s Autumn Statement for Growth our choice is not big government, high spending and high tax because we know that leads to less growth, not more.
“Instead we reduce debt, cut taxes and reward work.
“And we back British business with 110 growth measures.”
With the triple lock untouched, the state pension increased by 8.5 per cent, keeping in step with the usual earnings measurement.
And benefit claimants received bumps in line with September’s inflation figure of 6.7 per cent.
The Chancellor had considered choosing October’s lower 4.6 per cent inflation figure as it would have saved the government around £3 billion.
The Local Housing Allowance was also unfrozen, giving 1.6 million households an average of £800 extra support with rent next year.
But that carrot will came with a hefty stick.
If after two years of “intensive support”, Brits on benefits haven’t found work, they will be put on a mandatory work placement to boost their skills and improve their employability.
If they choose not to engage with the work search process for six months, their benefits will be completely cut off.
Brits with mobility and mental-health problems also risk having their Universal Credit cut if they fail to look for jobs they can do from home.
7
The strict new rules will apply to all new benefit claimants from 2025 and existing ones will be getting assurances that their right to benefits will not be reassessed if they look for a work-from-home job.
The decision is said to be based on evidence that over half those in the 2.4 million sick and disabled group who want to work do not do so because they are worried about being reassessed if it does not work out.
The Chancellor said: “The party opposite tried to reduce poverty by tinkering with benefits and tax credits.
“They wanted to move people from just below the poverty line to just above it.
“But Conservatives know the best way to tackle poverty is through work.
“By reforming the welfare system, reducing workless households and tackling low pay we have helped lift 1.7 million people out of absolute poverty since 2010 because a central part of our plan for growth for the British economy is to make work pay.”
Mr Hunt’s twice yearly update of the nation’s finances is set to boost business investment by £20 billion a year.
Firms saw the relief scheme that allows them to claim every penny they invest against their tax bill made permanent at the cost of more than £10 billion a year.
Mr Hunt said: “Under Labour business investment was 9.3% of GDP in real terms.
“Taken together, the overall impact of today’s growth measures will be to increase business investment in the UK economy by around £20 billion a year within a decade, nearly 1% of GDP at today’s level.
“That is the biggest ever boost for business investment in modern times, a decisive step towards closing the productivity gap with other major economies and the most effective way we can raise wages and living standards for every family in the country.”
While the overall tax burden will be 0.7 per cent of GDP lower on the back of the Autumn Statement, it nonetheless claws back less than a quarter of tax rises from fiscal drag.
There were also £19 billion worth of effective spending cuts and Britain’s tax burden is projected to continue rising until the end of the decade.
The government’s economy watchdog, the Office for Budget Responsibility, also say households will experience the biggest drop in living standards since 1950s.
Shadow Chancellor Rachel Reeves slammed the Autumn Statement as leaving “working people worse off” after “13 years of economic failure under the Conservatives”.
She said: “Prices are still rising in the shops, energy bills are up and mortgage payments are higher after the Conservatives crashed the economy.
“The Conservatives have become the party of high tax because they are the party of low growth.
“Nothing the Chancellor says or does in his autumn statement can change their appalling record.”
Liberal Democrat Treasury spokesperson Sarah Olney MP said: “This is a deception from Jeremy Hunt after years of cruel tax hikes on hard-working families from this government.
“Conservative chaos has sent mortgages and tax bills soaring, today’s announcements won’t even touch the sides.
“Today has been more stale nonsense from a Conservative government out of touch and out of ideas.”
7
7
7
