The spring Budget delivered by Chancellor Jeremy Hunt introduces a range of measures affecting UK families, motorists, workers, and various industry sectors, alongside regulatory changes concerning short-term lettings, renewable energy investments, and VAT threshold limits due to EU rules.
In a series of recent fiscal and regulatory announcements affecting multiple sectors of the UK, Chancellor Jeremy Hunt outlined key changes in the spring Budget, regulatory concerns around short-term lettings, increased funding for renewable energy, and limitations on VAT threshold adjustments due to EU rules.
The spring Budget unveiled by Chancellor Hunt introduced several measures aimed at different segments of the UK population. Parents are set to benefit from an increased high-income child benefit charge threshold, aiding approximately 170,000 families. Motorists will see ongoing relief at the pumps through a £5bn investment to freeze fuel duty, while workers are to receive a further 2p cut in National Insurance, netting an average of £450 extra per year for employees. On the other hand, home buyers saw no relief measures, non-doms face a crackdown on tax breaks, holiday let owners are subjected to increased taxes, and smokers will contend with new levies on vaping products and increased tobacco duties. The budget also introduces a new British ISA, boosts manufacturing and creative industry funding, and raises corporate tax relief for film-makers to support various sectors.
Concerns were raised about landlords potentially exploiting a loophole in the crackdown on Airbnb-style short-term lettings, which could exacerbate the housing shortage and impact long-term rental availability. Regulations requiring council permission for short-term holiday homes are being proposed, particularly to address the surge in short-term lets in central London areas.
The government has announced a substantial £1 billion annual subsidy for the next renewable energy auction, with a focus on boosting offshore wind projects. This move reflects a significant commitment to renewable energy development, amidst criticism over the extended windfall tax on North Sea fossil fuel producers and concerns around the deployment of small-modular nuclear reactors.
Finally, Chancellor Hunt disclosed that due to EU rules, specifically the Northern Ireland protocol, he is limited in further increasing the VAT threshold for UK businesses beyond the newly announced £90,000 limit. This decision has met with disappointment from Conservative MPs and criticism over the EU’s influence on UK tax policies. Despite the restrictions, this adjustment exempts an additional 28,000 small businesses from VAT, marking the first rise in the VAT threshold in seven years.
These announcements represent a complex mix of fiscal, environmental, and regulatory changes aimed at addressing immediate concerns while steering the UK towards future economic and sustainable development goals.
