Attention, attention! The UK economy is about to undergo a significant change. Are you ready for it? Hunt’s Bold Moves in the Budget have left everyone on their toes, wondering what this means for them and their wallets. It’s time to buckle up and dive into the details of these sweeping changes that could affect everything from taxes to healthcare. Let’s explore what lies ahead in this exciting new chapter of UK finance together!

UK economy overview

The United Kingdom economy is the fifth largest in the world with a GDP of $2.6 trillion. The service sector accounts for 73.4% of GDP, while manufacturing and construction make up 20.3% and 6.3% respectively. The economy has been growing steadily since 2013, but growth has slowed in recent years. In 2016, GDP growth was 1.8%, down from 2.2% in 2015 and 3.1% in 2014. The slowdown is mainly due to slower growth in the service sector, which accounts for more than two-thirds of GDP. The UK’s main trading partners are the United States, Germany, France, and the Netherlands.

The budget deficit was reduced to 2.4% of GDP in 2016/17, from 10% in 2010/11. This was achieved primarily through spending cuts, but also through higher taxes on corporations and individuals earning over £150,000 per year. Government debt as a percentage of GDP has also fallen from a peak of 100% in 2016 to 86%. However, debt levels are still high by historical standards and interest payments on the debt consume a significant proportion of government spending (interest payments were £43 billion in 2016/17, or 12% of total government spending).

The budget announced by Chancellor Philip Hammond on 8 March 2018 contained some bold measures to boost investment and reduce inequality. These included:

– A £30 billion increase in infrastructure spending over the next 5 years
– A

Advertisement

Hunt’s budget

The Chancellor of the Exchequer, Philip Hammond, delivered his long-awaited budget on 29 October 2018. As expected, it contained a number of measures designed to boost the UK economy and ease the pressure on household budgets. Here’s a closer look at some of the key measures announced in the budget and what they could mean for you and the economy:

1. Income tax cuts for 32 million people: The Chancellor announced that the personal allowance – the amount you can earn before paying income tax – will increase from £11,850 to £12,500 in April 2019. This will mean that 32 million people will pay £1,050 less in income tax next year. The higher rate threshold – the point at which you start paying 40% income tax – will also increase from £46,350 to £50,000. This means that 2 million people will be taken out of the higher rate tax bracket.

2. A freeze on fuel duty: Fuel duty has been frozen for nine years in a row and was due to rise by 2p per litre in April 2019. However, the Chancellor has announced that fuel duty will remain frozen next year, saving drivers an average of £8 per tank of petrol or diesel. This is good news for motorists but bad news for the public finances as it will cost the government around £800 million in lost revenue next year.

3. An increase in investment spending: The Chancellor announced an extra £1 billion for investment

The reaction

The reaction to Hunt’s budget announcement has been largely positive, with many people lauding his boldness in making such a move. However, there are some who are concerned about the possible implications of the budget, particularly with regards to the UK economy.

Advertisement

Overall, though, it seems that Hunt’s budget announcement has been well-received by the public and has given them something to think about when it comes to their own finances.

What it means for you

In his first budget as Chancellor, Rishi Sunak has made a number of bold moves which will have an impact on the UK economy and your wallet. Here’s what you need to know.

Sunak has announced a package of measures worth £30 billion to boost the economy and protect jobs during the coronavirus pandemic. This includes a £12 billion injection into the NHS, £5 billion for local authorities to help them cope with the outbreak, and £1.6 billion for schools to support them in delivering online learning.

There is also an increase in spending on Universal Credit and Working Tax Credit, which will provide a boost to low-income households. And self-employed workers will be able to claim up to 80% of their average monthly profits, up to a maximum of £2,500 per month.

In terms of tax, there are no changes to income tax or National Insurance rates at this time. However, fuel duty will be frozen for another year and there will be an increase in tobacco duty. And businesses will get a temporary cut in VAT from 20% to 5%, which will apply until 12 April 2021.

Advertisement

So what does all this mean for you? Firstly, if you’re employed then your job is likely to be more secure as the government is pumping money into protecting jobs. If you’re on a low income then you’ll get some extra help from Universal Credit and Working Tax Credit. And if you’re self-employed

Conclusion

It’s clear that Rishi Sunak has taken bold steps in the budget to try and promote economic growth in the UK. This is undoubtedly a positive move, and while it may not be possible to judge its success or failure until some time passes, there are certainly some tangible benefits that can already be seen. For those looking to save money on taxes and benefit from new government schemes, now could be the perfect time to make smart financial decisions. The full impact of Rishi Sunak’s budget will only become apparent over time but for now, at least there appears to be cause for optimism.

Advertisement