IN just one week Jeremy Hunt will unveil the government’s Autumn Statement – a budget that will have huge implications for your pocket.
The Chancellor is on a mission to save the British economy, which was plunged into crisis by the pandemic, Mad Vlad Putin’s war in Ukraine and Liz Truss’ disastrous mini budget.
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There’s currently an estimated £50bn black hole in the public purse that desperately needs filling.
To do that, Mr Hunt will look to cut spending and raise taxes.
Rishi Sunak recently admitted there will be “difficult decisions” ahead.
And a Treasury source said the Chancellor has had to “think the unthinkable” to plug the gap.
All will be finally revealed on November 17, when Mr Hunt announces the Autumn Statement in the Commons.
But here are some measures that COULD come into force.
STEALTH TAX
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 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.
HIGH EARNERS’ INCOME TAX HIKE
Mr Hunt is mulling a shock tax raid on the rich that would see tens of thousands of extra high earners slapped with the top rate.
The £150,000 threshold at which the additional rate of income tax kicks in could be lowered and that rate of 45p in the pound even raised.
It would mark a spectacular change in direction just six weeks after Ms Truss tried to reduced it to 40p and would break a key 2019 Tory manifesto pledge not to raise income tax.
WINDFALL TAX
The Chancellor 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 £8bn 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.
PENSION TRIPLE LOCK
The issue of keeping or ditching the pension triple lock has been a massive subject of debate in Westminster.
With its safety previously called into question, MPs from all political parties have pleaded with Mr Hunt to keep the policy in place.
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%
In what will potentially be a major win for pensioners, so far the triple lock seems set to stay.
While the plan has yet to be confirmed, the government hopes it will be seen as “fair and compassionate”.
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BENEFITS UPRATE
The Chancellor is understood to be in favour of uprating benefits in line with inflation next April.
Alongside the pension triple lock, what to do with Universal Credit has been a major source of contention in Westminster.
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.
As things stand it looks like that will go ahead.
COUNCIL TAX HIKE
Millions of Brits could be hit with higher council tax bills as Mr Hunt weighs up tough options for saving the economy.
Alongside Rishi Sunak, the Chancellor is considering whether to hike the amount households pay their local council to generate more money.
Usually councils have to hold a referendum to increase rates above 2.99 per cent – but the Chancellor is thinking of scrapping that rule.
No final decisions have been made yet.
