Chancellor’s claims of cuts in personal taxes don’t live up to their billing.
Following the Spring Statement, Nigel Morris, Employment Tax Director at MHA, says the Chancellor’s claims of big cuts in personal taxation don’t live up to their billing:
“The Chancellor’s reluctance to provide much needed financial support for consumers demonstrates an unsettling move away from his previous stance of fulsome aid for struggling households. Although low income households will welcome today’s temporary cut in fuel duty and the increase in the national insurance (NI) threshold, in reality these measures fall far short of the financial support the Chancellor should have introduced.
“For example, the 5p cut to fuel duty is already funded by increased VAT on higher raw material prices. The rise of the NI threshold from July to £12,570 is perhaps higher than anticipated, but a delay until July will mean the new Health and Social Care levy will bite first. Thirty year-high inflation levels and soaring energy prices also mean raising the threshold will fail to compensate for how much people across the country are worse off than they were before this year began.
“What’s more, there should be enough in the UK government’s coffers to go much further with its financial support, at the very least delaying the introduction of the Health and Social Care Levy until the end of 2022.”
This article is a part of our dedicated Spring Forecast Statement hub. For more analysis and insight, please click here.
