(Bloomberg) -- UK Chancellor of the Exchequer Jeremy Hunt unveiled a package of 110 measures in his Autumn Statement laying out the government's tax and spending plans, saying Britain has “turned a corner.”
The Treasury puts the total cost of the package at £14.3 billion ($17.8 billion) in 2024-25 — during which a general election is expected — with the giveaway rising to £21.1 billion four years later.
Here's a rundown of some of the key measures he announced on Wednesday, and the Treasury's estimate of their annual cost by the 2028-2029 tax year, unless otherwise stated.
Policy Measures
National Insurance: Hunt cut the rate of the national insurance payroll tax for employees by 2 percentage points to 10% from Jan. 6. He saved the measure for last in a speech to the House of Commons lasting just over 50 minutes — the traditional rabbit out of the hat that chancellors like to flourish. COST: £9.3B
Earlier in his statement, he had also scrapped so-called Class 2 national insurance payments made by the self-employed, and reduced their Class 4 payments — the main rate — by a percentage point. COST: £710M
Full Expensing: Hunt made permanent an existing three-year investment tax relief for businesses which affords them 25p of tax relief on every £1 invested in plant and machinery. In doing so, he satisfied one of the main requests from British companies ahead of the statement. COST: £10.9B
Alcohol Duty: The chancellor froze all alcohol duties until August 2024. COST (2 tax years): £310M
Welfare & Pensions: Hunt increased welfare benefits by the September inflation rate of 6.7%, as is standard. In the run-up to the statement, his team had been examining using the lower October rate of 4.6%. He also raised pensions by 8.5%, in line with the rise in wages in July. Both followed standard practice, so aren't included in the Treasury's costings for new measures included in the Autumn Statement.
Business Rates Discount: Hunt extended by a year the 75% discount on business rates paid by retail, hospitality and leisure industries. COST 2024-25: £2.7B
Hunt also froze the multiplier used for small business property valuations for a further year. COST: £410M
Increasing Housing Allowance: Hunt increased the housing allowance to cover rents up to the 30th percentile in local rental markets. COST: £1.7B
Work Capability Assessments: The government will change how benefits claimants are assessed on their ability to work in a move that will classify more people as being able to do so because they can work from home, reducing eligibility for welfare payments. SAVING: £1.3B
Other Measures: Hunt increased the duty on hand-rolling tobacco (RAISING £100M); increased cash available to incentivize businesses to invest in energy efficiency measures under so-called Climate Change Agreements (COSTING £330 million); increased funding for an NHS mental health program (COSTING £220m); announced simplifications to research and development tax reliefs (COSTING £280M); and implemented an OECD rule on under-taxed profits (RAISING £490M).
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