FTSE plummets by 236.35 points (3.09%) as Jeremy Hunt unveils UK’s ‘budget for growth’.
General
The Energy Price Guarantee will remain at £2,500 for the typical household for the next three months, this will save the average family a further £160.
According to the Office for Budget Responsibility, the rate of price rises, or inflation, is forecast to fall to 2.9% by the end of 2023.
Chancellor maintains 5p cut and freezes fuel duty for the next 12 months – he says it will save average driver £100 next year.
The UK economy is now expected to grow by 1.8 per cent next year, before rising 2.5 per cent, 2.1 per cent and 1.9 per cent in the following three years, respectively. The OBR also expects unemployment to rise by less than one percentage point to 4.1 per cent.
Taxes
The Annual Investment Allowance will rise to £1million. The Chancellor also confirms the introduction of ‘full expensing’, which allows all UK-based qualifying capital expenditure to be written off against taxable profits.
Main rate of corporation tax, paid by businesses on taxable profits over £250,000, confirmed to increase from 19% to 25%. Companies with profits between £50,000 and £250,000 to pay between 19% and 25% on a tapered scheme.
Pensions
The annual allowance has been lifted by 50 per cent to £60,000. Lifetime pension allowance (1.07m) scrapped completely.
Childcare
Parents on Universal Credit will now receive up to £951 for one child and £1,630 for two children per month which will now be paid upfront.
Hunt announces 30 hours of free weekly childcare is being extended to cover children below the age of three. It will cover all children from the age of nine months, he says. It will only apply to households where both parents are working. The provision only applies within term-time – so 38 weeks of the year.
