Government borrowing falls as Chancellor hints at tax cuts in Spring Budget

WRLO Accountants — Fri, 02 Feb 2024 09:10:37 +0000

Government borrowing fell to £7.8 billion in December 2023 giving Chancellor Jeremy Hunt more scope to make the tax cuts he has hinted at in the Spring Budget. The Office for National Statistics (ONS) data revealed that government borrowing for last December was around half of that borrowed in December 2022. It also showed that interest payable on government debt fell to £4 billion in December 2023, down by £14.1 billion when compared to December 2022. During the World Economic Forum’s annual meeting in Davos, Switzerland, Mr Hunt hinted that he wants to cut taxes The Chancellor said: ‘In terms of the direction of travel we look around the world and we note that the economies growing faster than us in North America and Asia tend to have lower taxes, and I believe fundamentally that low-tax economies are more dynamic, more competitive and generate more money for public services like the NHS. ‘That’s the direction of travel we would like to go in but it is too early to say what we are going to do.’ The Chancellor will present the Spring Budget on Wednesday 6 March 2024. Internet link: ONS website GOV.UK

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Autumn Statement cuts won’t stop tax revenues rising to highest ever levels

WRLO Accountants — Mon, 04 Dec 2023 12:57:44 +0000

The tax cuts announced in the 2023 Autumn Statement won’t prevent tax revenues rising to their highest ever levels, the Institute for Fiscal Studies (IFS) has warned. The IFS stated that announcing tax cuts in response to ‘highly uncertain’ changes in assumptions about the UK’s medium-term economic prospects ‘does not feel like a recipe for good management of the public finances‘. It also acknowledged that the Chancellor’s cuts to the rates of National Insurance contributions (NICs) put money back into the pockets of 27 million workers. However, it said the bigger picture means that the changes give back less than £1 of every £4 that has been taken away from households through changes to NICs and income tax announced since March 2021. However, the business group did welcome the Chancellor’s decision to make Full Expensing permanent but noted that the move indicates that the Autumn Statement was an event focused on medium-term growth. Paul Johnson, Director of the IFS, said: ‘The growth outlook has weakened. Inflation is expected to stay higher for longer. Higher inflation pushes up tax receipts by more than it pushes up spending on debt interest or social security benefits. ‘His immediate cut to national insurance will […]

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Government borrowing falls as Chancellor hints at tax cuts in Spring Budget

Autumn Statement cuts won’t stop tax revenues rising to highest ever levels