What the Spring Statement 2022 means to you

Yesterday we heard from chancellor Rishi Sunak on his 2022 Spring Statement, here is what it means to you.

The Chancellor cut fuel duty from 6pm yesterday by 5%, this is only the second time in 20 years he has done this, and the lower rate will stay in place for a year.

From July he has lifted the threshold for National Insurance in line with the personal income tax allowance to £12,570. The chancellor said this amounted to a £6 billion tax cut for 30 million people. In 2024 the Government are going to cut the rate of income tax from 20p to 19p, this is the first cut to the basic rate tax rate for 16 years 

The Chancellor warned they expect inflation to average at 7.4% this year.

The government set up a £500 million fund to help the poorest households last year and said it would be doubled to a billion from April to provide further support for families with the cost of living.

VAT on energy saving measures such as solar panels, heat pumps and roof insulation has been cut to zero from 5% for five years. He advised this would result in a £1000 reduction in the cost of installing a solar panel.

As a gesture to help small businesses the Chancellor lifted the tax relief scheme that allows them to lower their National Insurance bills. The allowance will rise from £4000 to £5000.

He also advised that the Office for Budget Responsibility had warned that the war in Ukraine had given unusually high uncertainty around the economic outlook and we should expect slower growth than previously anticipated. It, therefore, forecast growth of 3.8% this year, 1.8% in 2023, 2.1% in 2024 and 1.8% in 2025.

If you are unsure how any of these announcements affect you and would like to discuss them, please give us a call on 01905 779193 or email us.

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