UK Chancellor of the Exchequer Jeremy Hunt presented the last budget before the next election on Wednesday. Prime Minister Rishi Sunak's government is promising to lower inflation, boost growth and put even more money in British taxpayers' wallets.
In the document submitted, the British government forecast UK gross domestic product (GDP) to grow by 0.8% this year, up from 0.1% in 2023 and 1.9% in 2025. As the Office of Accounts Budget (OBR) pointed out in November. 0.7% growth in 2024 and 1.4% growth in 2025.
Despite growth of 0.1% last year, the United Kingdom entered a technical recession after two consecutive quarters of contraction, with GDP falling 0.1% between July and September and 0.3% between October and December.
And Jeremy Hunt pointed out in parliament that inflation, currently around 4%, will be below the Bank of England's official target of 2% “within a few months”.
The data released this Monday indicated that the state deficit will fall from 4.2% of GDP in 2023/24 to 3.1% in 2024/25, and accumulated net debt will fall to 94% of GDP from the current 96.5%. in GDP by 2028/29.
Activities for families
“Of course, interest rates will be higher because of lower inflation, but thanks to progress in delivering the Prime Minister's economic priorities, households can now be helped with permanent tax cuts,” the finance minister said.
Among the relief measures for taxpayers' portfolios, workers' contributions to Social Security were reduced by two percentage points from 10% to 8%. Reducing social security contributions is a symbolic move by Rishi Sunak's government to increase the purchasing power of households.
“Lower taxes mean more growth,” said Jeremy Hunt. It was reduced from 12 percent to 10 percent in November.
On real estate taxes, Hunt announced that the tax on real estate capital gains would increase from 28% to 24%. According to the British newspaper “The Guardian”, he also announced the scrapping of the stamp duty exemption for buyers of more than one house.
Another move that will please the British is that alcohol duty, due to rise to 3% from August, will not go ahead for now (it has been postponed until February 2025). And fuel tax is frozen.
Based on savings, the government will offer tax relief on gains on investments of up to £5,000 to “encourage more people to invest in UK property”.
It is important to remember that the United Kingdom will go to the polls 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 signaled that elections could take place in the second half of 2024, although no date has been set.
Other activities
Hunt announced measures to support British films with a budget of less than £15 million and pledged more than £26 million to restore national theatres.
Henceforth 'goods' will be taxed.vaping', which is levied on imports by manufacturers, in an attempt to reduce consumption of this product among younger people, points out “The Guardian”.
Other measures announced by Jeremy Hunt this Wednesday include reducing the number of doctors filling out forms using artificial intelligence, digitizing hospital processes and improving the use of the country's National Health Service.
In terms of expenditure, the government is committed to maintaining public expenditure growth at 1%. At the defense level, spending increases to 2.5% of GDP (0.5 percentage points higher than the current figure).
On energy, the minister announced that £160m would be spent on two nuclear installations, and £120m on 'green' industries including offshore wind farms and carbon capture and storage schemes.
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