Jeremy Hunt, Britain’s finance minister, presented his final budget before the next election on Wednesday. Prime Minister Rishi Sunak’s government promises to reduce inflation, increase growth and increase money in British taxpayers’ wallets.
In the document provided, the British government forecasts that UK GDP will grow by 0.8% this year, compared to 0.1% in 2023 and 1.9% in 2025. In November, the Accountability Office (OBR) budget indicated growth By 0.7% in 2024 and 1.4% in 2025
Despite growth of 0.1% last year, the UK entered a technical recession after two consecutive quarters of contraction, with GDP falling by 0.1% between July and September, and by 0.3% between October and December. the first.
Furthermore, Jeremy Hunt also indicated in Parliament that inflation, currently at around 4%, would “within a few months” be below the Bank of England’s official target of 2%.
Data presented on Monday also suggest that the country’s deficit will move from the equivalent of 4.2% of GDP in 2023/24 to 3.1% in 2024/25 and that accumulated net debt will fall from the current 96.5% of GDP to 94% of GDP by 2028/29.
Measures for families
The Finance Minister said: “Of course, interest rates remain high as we reduce inflation, but thanks to the progress made in achieving the Prime Minister’s economic priorities, we can now help families with permanent tax cuts.”
Among the measures to ease taxpayers’ wallets is to reduce workers’ contributions to Social Security by two percentage points, from 10% to 8%. Reducing social security contributions is the symbolic measure by which Rishi Sunak’s government intends to increase the purchasing power of households.
“Lower taxes mean more growth,” Jeremy Hunt said. In November, the rate was reduced from 12% to 10%.
In real estate taxes, Hunt announced that the tax on real estate capital gains will rise from 28% to 24%. He also announced the cancellation of the stamp duty exemption for those who buy more than one house, according to what the British newspaper “The Guardian” reported.
Another measure that may please the English is that the tax on alcohol, which was supposed to increase by 3% from August, will not go ahead for the time being (it has been postponed until February 2025). The fuel tax remains frozen.
In terms of savings, the government will exempt investment gains of up to £5,000 from tax, “to encourage more people to invest in UK assets.”
It is important to remember that the UK will go to elections in less than a year. By law, the next government must be elected by the end of January, but the current prime minister has already indicated that elections could take place in the second half of 2024, although a date has not yet been set.
Other measures
Hunt also announced measures to support British films with budgets of less than £15 million and pledged more than £26 million to restore national theatres.
There will now also be a tax directed at “products”.vaping“, is pushed on imports by manufacturers, in an attempt to reduce consumption of this product among young people, as The Guardian points out.
Other measures announced by Jeremy Hunt on Wednesday included reducing the number of doctors filling out forms using artificial intelligence, digitizing hospital operations and improving the country’s National Health Service app.
Regarding spending, the government committed to maintaining public spending growth at 1%. At the defense level, spending rises to 2.5% of GDP (0.5 percentage points more than the current figure).
Regarding energy, the minister announced that 160 million pounds will be spent on two nuclear facilities, and 120 million pounds on “green” industries, which include offshore wind farms and carbon capture and storage projects.
