Markus Andrews

Sign up for the View from Westminster email for expert analysis straight to your inboxGet our free View from Westminster emailJeremy Hunt has unveiled a further 2 per cent cut to national insurance in his 2024 Budget, as the chancellor seeks to entice voters ahead of this year’s general election.Combined with last autumn’s identical national insurance cut, Mr Hunt claims the two tax giveaways will leave the average worker £900 better off.Other measures to support people that were announced on Wednesday include an extension of the Household Support Fund and a rise in the earnings threshold for child benefit, from £50,000 to £60,000.But economists have warned that the national insurance reduction will still plunge thousands of families into poverty, with nearly half of the £10.4bn giveaway set to end up in the pockets of the richest 20 per cent of households.Follow our live blog on the Budget for more on Jeremy Hunt’s announcements by clicking hereThe New Economics Foundation had warned that a 1p cut alone would push more than 55,000 people into relative poverty, whereas it said Mr Hunt could instead have lifted 384,000 people out of poverty if he had chosen to put the same amount into boosting universal credit. The Independent’s Budget calculator, created by tax advisory firm Blick Rothenberg, below will help you to determine whether you are better or worse off following Wednesday’s statement. Enter a few details such as how much you earn, whether you are single, if you in a couple or have a family to see how your finances will be impacted. More

Sign up for the View from Westminster email for expert analysis straight to your inboxGet our free View from Westminster emailMillions of workers will benefit from an additional 2p cut in national insurance as Jeremy Hunt announced moves to ease the tax burden ahead of next year’s general election.The Tory chancellor also confirmed another extension of fuel duty freeze – meaning motorists will continue to save on petrol prices.But to raise the money for the raft of Tory tax cuts, the chancellor also announced a new levy on vaping and an abolition of the non-dom tax status.The Independent takes a look at the big winners and losers from the chancellor’s Budget:Winners:ParentsParents are set to benefit from today’s budget as Mr Hunt announced that the high-income child benefit charge threshold will be raised from £50,000 to £60,000 and the taper – which applies when an individual’s income increases beyond the threshold of £60,000, meaning they will gradually lose eligibility for child benefit – will extend up to £80,000. He explained: “That means no one earning under £60,000 will pay the charge, taking 170,000 families out of paying it altogether. And because of the higher taper and threshold, nearly half a million families with children will save an average of around £1,300 next year.”MotoristsIn a move that many motorists will welcome, Mr Hunt has announced the government will spend £5bn to freeze fuel duty.This will maintain a 5p cut in fuel tax – which was first announced in 2011-  that brought petrol prices down. WorkersFrom April 6, Jeremy Hunt has announced a further 2p cut to National Insurance, on top of a previous cut announced in the Autumn Statement.This tax cut will cost the government £10bn and will benefit workers who will see a reduction in contributions paid on their earnings.But think tanks have warned that the 2p cut will result in thousands being plunged into poverty and say it could exacerbate financial inequalities since those families rely on the services funded by taxation.Mr Hunt said this means an additional £450 a year for a typical employee.InvestorsMr Hunt announced a plan for new British ISA, allowing £5,000 investments in UK firms as part of his plan to make the UK the world’s next Silicon Valley.He said the move would “encourage more people to invest in UK assets”.Researchers The chancellor also announced a £360m research package to boost British manufacturing, which the chancellor said would boost manufacturing and research and development, including electric vehicles and pharmaceuticals.Film-makers and creative industriesFil and TV studios will have been handed a 40 per cent corporate tax relief, as Mr Hunt said the UK will be “second only to Hollywood” for film making.The plan covers independent films shot in the UK that have a budget less than $19 million.Chancellor Jeremy Hunt was delivered his Budget in parliament today LosersHome buyersThere was little relief for homebuyers in the chancellor’s statement.The Independent revealed earlier this year the Treasury was looking at helping those desperate to get on the property ladder by backing 99 per cent mortgages.But the idea did not make the cut.Non-domsIn a dramatic U-turn the chancellor announced plans to crackdown on the tax breaks for controversial non-doms in the Budget.The tax loophole hit the headlines two years ago when it was revealed the prime minister’s wife was a non-dom, a person who lives in the UK but is not settled here permanently, meaning they only pay UK tax on money made in this country. Mr Hunt had previously rejected calls to reform the rules, warning it would send high earners overseas.But in the end he decided he needed the money the changes would rase.Owners of holiday letsThe chancellor also unveiled a tax raid on the owners of short-term holiday lets. Higher taxes on second homes used as holiday lets are expected to raise hundreds of millions of pounds.But the Conservatives have been warned the change will harm tourist hubs across the country.SmokersBad news for smokers as the chancellor announced the introduction of a levy on vaping products from October 2026 in a bid to discourage non-smokers from taking up vaping.He also announced that there will be an increase in tobacco duties.Oil and gas companiesChancellor Jeremy Hunt extended the Energy Profits Levy for an additional year, blaming the increase in energy prices caused by the Ukraine war. The windfall tax applies to profits made from extracting UK oil and gas and in its first year the scheme brought the UK government an extra £2.6bn.Rishi Sunak introduced the 25 per cent energy profits levy when he was chancellor to help fund cost-of-living support for UK families. That was increased to 35 per cent in January 2023.Mr Hunt announced that extending the sunset on the Energy Profits Levy for an additional year to 2029 will raise £1.5 billion. More

Sign up for the View from Westminster email for expert analysis straight to your inboxGet our free View from Westminster emailJeremy Hunt has used the Budget to slash national insurance by a further 2 per cent, as the chancellor seeks to woo voters ahead of the next general election.By repeating his previous cut to the tax in his autumn statement, Mr Hunt said the two reductions would together save workers an average of £900 a year, with Wednesday’s cut expected to cost the Treasury £10.4bn. Taken together he claimed the tax cuts would lead an extra 200,000 people to join the workforce. But the Institute for Fiscal Studies warned that it would not be enough to prevent taxes as a share of GDP rising to record levels within five years.The chancellor also announced plans to raise nearly £3 billion a year through a crackdown on tax breaks for ‘non-doms’, two years after the Independent revealed the prime minister’s wife held the controversial status. Child benefit will also be reformed to end the “unfairness” that penalises many parents for earning just over £50,000, helping half a million families next year. With recent polling putting their party’s popularity at a 45-year low, Mr Hunt and prime minister Rishi Sunak had been determined to offer a tax giveaway to the electorate, and are reported to have targeted national insurance over income tax after deciding the latter could be too inflationary.Londoners are set to benefit the most from the latest 2 per cent cut, by an average of £608, while those in the northeast will keep an average of £342 more of their pay, equating to less than £1 per day, according to analysis by the IPPR think-tank.Almost half of the £10.4bn give-away will “end up in the pockets of the richest fifth of households, while a meagre 3 per cent” will benefit the poorest fifth, the think-tank said.With the UK in the grips of a technical recession, Britain’s sluggish economy and consequent reduction in predicted tax revenues hit Mr Hunt’s plans. While the Office for Budget Responsibility said in November that Mr Hunt had £13bn of fiscal headroom, economists believe this may have increased to around £18bn due to recent falls in inflation. But this is less than predicted a few weeks ago when interest rate cuts appeared more imminent.Unveiling his plans, the chancellor told MPs “countries with lower taxes generally have higher growth”.Mr Hunt has previously talked of moving towards a “lower tax economy”, although he has stressed the need to do so in a “responsible” way. He said the Conservatives would aim to abolish NICs completely over time but did not set out a timeline for doing so.Tom Pollard, of the New Economics Foundation think-tank, warned that cutting national insurance would benefit high earners the most “while doing nothing for those really struggling to make ends meet”, and calculated that investing the same money in Universal Credit benefits “could lift 384,000 people out of poverty”.Labour welcomed the move to cut 2p from NICs but suggested Mr Sunak had broken a promise to cut income tax.In his response, Sir Keir Starmer, the party’s leader described the Budget as a “Tory con” and accused the chancellor of giving with “one hand” and taking “even more with” the other.He told the Commons: “The story of this parliament is devastatingly simple: a Conservative Party stubbornly clinging to the failed ideas of the past, completely unable to generate the growth working people need, and forced by that failure to ask them to pay more and more, for less and less.“And as the desperation grows they torch not only their reputation for fiscal responsibility but any notion that they can serve the county, not themselves.“Party first, country second while working people pay the price.”He went on to accuse the Tories of losing control of the economy and making “working people pay” with the tax burden to remain at a record high.“They should be under no illusion,” he said. “That record is how the British people will judge today’s cuts, because the whole country can see exactly what is happening here.“They recognise a Tory con when they see it, just as they did in November. Give with one hand, take even more with the other.”More follows… More

MPs laugh as Sunak is asked what part of his economic legacy he is most proud of Sign up for the View from Westminster email for expert analysis straight to your inboxGet our free View from Westminster emailJeremy Hunt has delivered a further cut in national insurance in today’s Budget statement.Mr Hunt announced a two percentage point cut to national insurance among a series of measures in the spring Budget, in a repeat of his autumn statement.In his hour-long speech, which began with interruption from opposition MPs, he announced a freeze on alcohol duty will be extended until February 2025, and a 5p cut to fuel duty is to continue for another 12 months.He has also promised to deliver the government’s free childcare expansion pledge, starting on 1 April, with guaranteed rates paid to childcare providers.And he abolished the tax status of so-called “non-doms” used by wealthy overseas individuals.Two years ago,The Independent revealed that Rishi Sunak’s wife Akshata Murty dodged millions in UK tax by taking advantage of the loophole.Mr Hunt will hope the perks delivered will attract voters for the next general election with the Tories’ popularity currently languishing at a 45-year low.Labour welcomed the cut to national insurance, but claimed Rishi Sunak had broken a promise to cut income tax.Sir Keir Starmer said: “Having briefed that all week, that an income tax cut was coming, that promise is in tatters today.”Show latest update 1709736863Economic benefits of Hunt’s Budget ‘almost fully offset’ by decreasing labour force, says OBRThe economic benefits of Jeremy Hunt’s Budget are “almost fully offset” by changes to the labour market and productivity, the OBR has said.Levels of economic inactivity among the UK population are higher than assumed, said chair Richard Hughes, with long-term illness both the most common and fastest growing reason for being outside the labour force.“This means that the level of real GDP at the start of this year is slightly lower than we anticipated in November. But our forecast for economic growth thereafter is largely unchanged,” he said.“This is because the positive effect on GDP of a larger population, lower energy prices, lower interest rates and a small boost from measures in the chancellor’s spring Budget is almost fully offset by the negative effects of lower labour participation, average hours and productivity.”He added that the overall level of GDP is just 0.1 per cent higher than forecast in November, but GDP per person will be a full percentage point lower in 2029 than anticipated in November.Andy Gregory6 March 2024 14:541709735863Starmer welcomes Hunt’s plans to improve NHS IT and fuel duty freezeSir Keir Starmer welcomed the Chancellor’s plans to improve NHS IT, and the fuel duty freeze, which he said Labour would support.The Labour leader gave his backing to extra NHS IT funding, adding: “Although, I have to note that the Chancellor, when he was health secretary 10 years ago, promised to make the NHS paperless by 2018.”He went on: “I know the Prime Minister’s fondness for Elon Musk extends to an enthusiastic embrace of his community notes on fact checking, so I will say this bit slowly, Labour supports the fuel duty freeze, that is our policy, and I look forward to the Prime Minister’s acknowledgement of that in coming days.”Sir Keir urged Jeremy Hunt to ensure the saving was passed on to “hard-pressed families at the pump”.The Chancellor confirmed in his Budget that the 5p per litre cut implemented in March 2022 will be retained for another 12 months, and fuel duty will not increase in line with inflation.Andy Gregory6 March 2024 14:371709735800Middle East conflict escalation could see inflation spike to 7%, says OBR chairAn escalation in the conflict in the Middle East could see inflation spike back to 7 per cent, the OBR has warned. “Less than three months has passed since our last forecast and the period between has been relatively uneventful economically, at least by the tumultuous standards of the early 2020s,” said chair Richard Hughes.Inflation has come down more quickly than expected and is now expected to fall below the 2 per cent target by the second half of this year.While their forecasts are positive on inflation, conflict spilling over to other parts of the Middle East and interrupting oil and gas exports, could see quarterly inflation spike back up to 7 per cent and real GDP contract by around 1 per cent. Andy Gregory6 March 2024 14:361709735529OBR holding press conference on post-Budget forecastsThe Office for Budget Responsibility is now holding a press conference on its forecasts published in the wake of Jeremy Hunt’s Budget.Andy Gregory6 March 2024 14:321709735444Tory MPs should expect government to remove private school tax relief, jokes StarmerTory MPs should expect to soon defend the government on plans to remove private school tax relief following the chancellor’s decision to axe the non-dom status, Sir Keir Starmer said.Welcoming the move, which is a Labour policy, Labour leader Sir Keir said: “For those opposite now a little downbeat about another intellectual triumph for social democracy, I say get used to it, because with this pair in charge it won’t be long before they ask you to defend the removal of private school tax relief as well.“The harder they try with cynical games like this, the worse it will get for them, because the whole country can see exactly who they are.“Fighting for themselves, politics not governing, party first, country second.”Andy Gregory6 March 2024 14:301709735144Hunt has chosen inaction on homelessness, warns ShelterJeremy Hunt has “chosen inaction” on homelessness in a move which is harming the economy, the charity Shelter has said.“Homelessness is a political choice,” said chief executive Dame Polly Neate. “In the final Budget before a general election, with the housing emergency spiralling out of control, the chancellor has chosen inaction. “By ignoring the vast number of people losing their homes, he is harming both the economy and people whose lives are being wrecked by homelessness.“The Chancellor is right that investment is the best way to improve productivity. Had he invested in building 90,000 social homes a year he could end homelessness, save the taxpayer money, boost jobs, reduce the burden of poor housing on our NHS and improve children’s life chances.“If this government or the next is serious about wanting the economy to grow and people to thrive, investing in genuinely affordable housing is a no brainer. Building 90,000 social homes would pay for themselves and return an impressive £37.8bn back to the economy in just three years.”Andy Gregory6 March 2024 14:251709734889Starmer jokes that Hunt ‘taking lessons from the Willy Wonka Experience’Keir Starmer jibed that Jeremy Hunt has been “taking lessons in marketing from the Willy Wonka Experience in Glasgow.”The Labour leader said not “all is not as it seems” because “up and down the country” parents are still unsure if they will receive their childcare entitlement.Zoe Grunewald6 March 2024 14:211709734844Former Tory donor Rocco Forte says Hunt’s refusal to scrap ‘tourist tax’ is a ‘spectacular own goal’Sir Rocco Forte, chair of Rocco Forte Hotels, said it is “staggering” that Rishi Sunak and Jeremy Hunt refused to scrap the so-called “tourist tax” on overseas shoppers, despite a campaign by over 500 leading businesses calling for them to do so.Tourists from overseas were allowed to reclaim the 20 per cent VAT on their purchases in the UK until January 2021, and business chiefs have called for the perk to return to the retail and hospitality industries.Sir Rocco said: “The case for reintroducing tax-free shopping in the UK is clear and overwhelming. As things stand, every country in the EU offers sales tax rebates to tourists while we don’t, meaning the whole tourist economy in the UK is operating with one hand tied behind its back.“Independent economic analysis shows that scrapping the tourist tax would more than pay for itself because of the tourist spending that would be stimulated in hotels, restaurants, tourist attractions, taxis and the like, with an £11 billion boost to GDP.“Restoring tax-free shopping would also represent a major Brexit opportunity as the UK would be able to offer savings to a new market of 500 million EU consumers, thanks to our place outside the EU.“This is a spectacular own goal for UK plc. We will now need to persuade Labour as the likely incoming government that reform is a prerequisite for stronger economic growth.”Archie Mitchell, Political Correspondent6 March 2024 14:201709734605Starmer warns that ‘this is what decline looks like’Sir Keir Starmer has hit out at the “utterly discredited idea that economic growth is something the few gift to the many”.“This is what decline looks like and the complacency they’ve shown today, it takes your breath away. Britain deserves better than this,” the Labour leader said. “Britain deserves a real plan for growth, an end to 14 years of stagnation, wealth creation across the whole of the country, higher living standards for working people. This is the mission we need. “But yet again what we got was the same tired old formula, the sticking plasters, the chopping and changing, the party-first country-second politics with no repudiation of the utterly discredited idea that economic growth is something the few gift to the many.”Andy Gregory6 March 2024 14:161709734353Lib Dems attack Budget as ‘desperate last throw of the dice’The Lib Dems have hit out at Jeremy Hunt’s “bottom-of-the-barrel Budget”.“This is a bottom-of-the-barrel Budget from a Conservative government that has given up on governing,” said Sir Ed Davey.”Rishi’s recession is being followed by Hunt’s hangover, with years of unfair tax hikes while local health services are stretched to breaking point. This Budget had nothing to offer for people seeing their mortgage soar due to Conservative chaos or being left waiting for months in pain for NHS treatment.He added: “The public will see this for what is: a desperate last throw of the dice by a Conservative government that has neglected the NHS, trashed the economy and overseen a record fall in living standards. “It couldn’t be clearer that we need a general election now so voters can finally kick this tired and out-of-touch government out of office.”Andy Gregory6 March 2024 14:12 More