On 23 March 2022, The Chancellor of the Exchequer delivered his Spring Statement.
With the rapidly increasing costs of living exacerbated by events in eastern Europe, there were demands on the Chancellor to take more action than perhaps originally intended.
Several significant measures were announced:
National Insurance
- The threshold at which people start paying National Insurance will increase from £9,880 to £12,570 from July 2022.
Income tax
- The basic rate of income tax will be cut from 20% to 19% in 2024. This will mark the first cut in income tax for 16 years.
Employment Allowance
- The Employment Allowance, which gives relief to smaller businesses’ National Insurance payments, will increase from £4,000 to £5,000 from April 2022. Eligible employers will be able to reduce their employer NICs bills by up to £5,000 per year.
Fuel duty
- The Government will cut the duty on petrol and diesel by 5p per litre for 12 months. This will take effect from 6pm on 23 March, across the UK.
Energy saving works
- Homeowners installing energy efficiency materials such as solar panels, heat pumps, or insulation will see VAT cut on these items from 5% to zero for five years.
Further information can be found here.