The budget was a focus on supporting the Just About Managing section of the population through measures such an increasing the tax threshold, investment in housing, freezing fuel Duty and banning letting agency fees. The budget also focuses on innovation and infrastructure funding, reducing tax avoidance and increasing funding for export schemes in order to protect the economy from the impacts of Brexit. To do this had the previous targets for the budget surplus and Public debt have had to be abandoned.
This is the last Autumn Statement and there will be no Spring Budget instead they are to be replaced by an annual Autumn Budget with a Spring Statement which will contain no fiscal measures.
General Economic Status
• Office for Budget Responsibility growth forecast upgraded to 2.1% in 2016, then downgraded to 1.4% in 2017
• OBR forecasts growth of 1.7% in 2018, 2.1% in 2019 and 2020 and 2% in 2021
• Government target of a budget surplus in 2019-20 has been replaced with “as soon as practicable”
• Debt will rise from 84.2% of GDP last year to 87.3% this year, peaking at 90.2% in 2017-18
• The deficit will fall from 4% last year to 3.5% this year. It is forecast to continue to fall over the next five years, reaching 0.7% in 2021-22.
• Growth forecast at 2.1% for 2016 – up from 2% it forecast before the EU referendum 1.4% in 2017 – down from 2.2%, 1.7% in 2018 – down from 2.1% and 2.1% in 2019
General Business Issues
• National Living Wage to rise to £7.50 from April next year
• £23bn to be spent on innovation and infrastructure over five years
• Doubling UK export funding capacity
• government will review the tax environment for R&D to look at ways to build on the introduction of the ‘above the line’ R&D tax credit
Tourism Related Issues
Infrastructure and Transport
• £390 million will go to future transport technology, including driverless cars, renewable fuels and energy efficient transport.
• £170 million in flood defence and resilience measures
• The Chief Secretary to the Treasury will chair a new ministerial group that will oversee the delivery of priority infrastructure projects. The review will report in summer 2017.
• Cancelling planned Fuel Duty increase again VAT
• The government will consult on VAT grouping and provide funding with a view to digitising fully the Retail Export Scheme to reduce the administrative burden to travellers.
• For SMEs on the Flat Rate VAT scheme, the government will introduce a new 16.5% rate from 1 April 2017 for businesses with limited costs, such as many labour-only businesses.
• Commitment to cutting the rate of corporation tax to 17% by 2020 and reducing the burden of business rates by £6.7 billion over the next 5 years.
• The government will publish its response to the Making Tax Digital consultations in January
• The Government is reviewing tax in relation to self-employment to ensure that self-employed users of these schemes pay their fair share of tax and National Insurance
• Personal Allowance will rise to £11,500 in 2017-18. The point at which you pay the higher rate of income tax will increase from £43,000 this year, to £45,000 in 2017-18.
Air Passenger Duty
• The government is publishing a summary of responses to the consultation on how to support regional airports in England from the potential effects of APD devolution but intends to review this area again after the UK has exited from the EU.
• Insurance Premium Tax (IPT) will increase from 10% to 12%
• Budget 2017 will set out further details for making access to licences or services for businesses conditional on them being registered for tax.
• The government is amending the Gift Aid Small Donations Scheme to make it more accessible and flexible, and to ensure fairer treatment between charities that are structured in different ways.
• 100% business rates relief on new fibre infrastructure
• More than £1bn for digital infrastructure
(With thanks to ETA for compilation).