The Spring Budget presented by Chancellor Jeremy Hunt proposes several measures including a national insurance cut, the introduction of a vaping tax, and significant investments in healthcare, aiming to rejuvenate the UK economy and mitigate the cost-of-living crisis.
Chancellor Jeremy Hunt presented the Spring Budget with various measures aimed at stimulating the UK economy and providing relief to citizens, amid pressures to boost the Conservative Party’s prospects before the upcoming general election. Announced on March 6, 2024, the Budget includes significant changes such as a 2p cut to national insurance, expected to save employees an average of £450 and self-employed individuals £350 annually.
Other notable measures introduced by Hunt involve the introduction of a vaping tax scheduled for October 2026, the abolition of the non-dom tax system by April 2025, the launch of a “British Isa” to stimulate investments in UK assets, and reforms in the child benefits system to aid single-parent households. Additionally, the Budget outlines a £3.4 billion investment in a digital transformation plan for the NHS, focusing on incorporating AI to enhance healthcare services.
Amid concerns over the Conservative Party’s dwindling support, as polls indicate Labour’s 20-point lead, these Budget announcements are seen as a strategy to avoid electoral defeat. Speculations of a surprise general election on May 2 further underscore the urgency within the Conservative ranks. Hunt’s Budget also predicts economic growth revisions upwards, with an expected growth of 0.8% for the current year and 1.9% next year. Inflation is projected to fall, although the national debt is expected to rise.
Despite these measures, there’s apprehension about their sufficiency in reversing the Conservatives’ fortunes, with internal debates on the focus on national insurance cuts over income tax reductions showcasing the party’s divisions on economic strategy. Economists and the New Economics Foundation have expressed concerns that while some households may benefit, thousands could be pushed into poverty, suggesting that alternatives like boosting universal credit might be more effective.
To ascertain the individual impact of these Budget announcements, an online calculator provided by tax advisory firm Blick Rothenberg allows individuals to determine their financial position post-Budget based on their income and family status.
