Philip Hammond has delivered his first Budget as chancellor. These are the key points of what he has said.
- UK growth up this year; borrowing is coming down
- Increase in taxes for the self-employed
- Tax free dividend allowance drops from £5,000 to £2,000 from April 2018
- Measures for business rates amount to a £435m cut, including a £1,000 cut for 90pc of pubs
- £2bn for social care, and £100m for new triage programmes at English hospitals next winter
- Funding for a further 110 new free schools on top of the existing 500, including new specialist maths schools
- The economy has still shown “robust growth” as the UK begins its exit from the European Union
- “We are building the foundations of a stronger, fairer, more global Britain,” Mr Hammond says.
- Last year the UK economy grew faster than all the major economies expect Germany last year, Mr Hammond points out.
- He warns there is “not room for complacency” – productivity remains low, even though employment is up. “Our task for today is taking the next steps to equip Britain for a global future”.
Borrowing and the economy
- Growth will be up this year (from 1.4pc to 2.0pc), but down for the next three (compared to previous projections).
- ”Resilience in the economy is reflected in a strong labour market”, Mr Hammond says, pointing to falling unemployment figures. “This positive trend is set to continue over the forecast period,” he adds.
- Latest Office of Budget Responsibility GDP growth figures: 2017 – 2.0pc; 2018 – 1.6pc; 2019 – 1.7pc; 2020 – 1.9pc; 2021 – 2.0pc. That’s a big downgrade in GDP growth for 2019 and 2020 from the OBR, with 2018 and 2019 forecasts now in line with the Bank of England
- OBR forecasts borrowing of £51.7bn this year, lower even than March 2016 forecast of £55.5bn and much lower than £68.2bn in November
- UK debt as a proportion of GDP: 2016/17 – 86.6pc; 2017/18 – 88.8pc; 2018/19 – 88.5pc; 2019/20 – 86.9pc; 2020/21 – 83pc; 2021/22 – 79.8pc
- “Some have argued that lower borrowing this year should result in higher spending; I disagree,” Mr Hammond said. We’re spending £50bn of servicing the debt, he added
- He says he will “continue with his plan”, “undistracted by the reckless policies advanced by the opposition”.
- We cannot abolish business rates as they will fund local government, Mr Hammond says, but wants to find a way of taxing the digital economy
- “We will set out our preferred approach in due course”, Mr Hammond says, to groans from the House
- Capping business rate rises at £50 a month for those leaving small business rate relief
- £1,000 discount on pubs business rates bills if they fall below a ratable value of £100,000 (90pc of pubs do)
- £300m discretionary relief fund to tackle issues in their local areas
- Hammond says its a £435m cut in business rates
- Chancellor says that £140bn has been raised since 2010 by tackling tax avoidance evasion and non-compliance
- Top 1pc now pay 29pc of all income tax, Mr Hammond says
- People’s choices for employment should not be driven by tax implications, Mr Hammond says. Announces tax rise for self-employed
From April 2018, the Government will raise (Class 4) NIC payments for self employed people from 9pc to 11pc – raising £145m a year by 2021-22Repealed 15/03/17
- Lower NI from self-employed “cost our public finances over £5bn this year alone. That is not fair to the 85pc of workers who are employees”, Mr Hammond says