Chancellor Philip Hammond presented his first and last Spring Budget to the House of Commons in belligerent form.
Despite upgraded forecasts from the Office for Budget Responsibility (OBR), the Chancellor confirmed that he would stick to the government’s fiscal plan, with the stated aim of preparing Britain for a ‘global future’.
The Chancellor announced a number of significant measures for UK businesses, including a £435 million package for firms in England affected by the business rates revaluation, with a £50 a month cap on rate rises for those losing existing relief.
As the government’s flagship Making Tax Digital (MTD) initiative draws closer, there was also some good news for smaller firms, with the announcement that unincorporated businesses and landlords with turnover below the VAT registration threshold will have until 2019 to prepare for quarterly reporting.
However, a rather less welcome measure for the self-employed will see the main rate of Class 4 national insurance contributions (NICs) increase to 10% in April 2018 and 11% in April 2019.
Meanwhile, shareholders and directors of small private firms will see a significant reduction in the tax-free dividend allowance, which will fall from £5,000 to £2,000 in April 2018.
Keen to address the UK skills gap, the Chancellor announced the introduction of new ‘T-Levels’ for 16-19 year olds studying technical subjects from Autumn 2019, together with funding for 110 new free schools.
The Chancellor also confirmed previously announced measures for individuals, including the introduction of the new Tax-Free Childcare scheme, a three-year NS&I Investment Bond and the new Lifetime ISA.
Under the Chancellor’s new fiscal timetable, the next Budget will be held this Autumn, followed by a Spring Statement in 2018.