UK Autumn Statement

Today, the UK Chancellor announced the government's future plans in the Autumn Statement 2014.

 

The economy

·         “Warning lights are flashing over the global economy”

·         Deficit forecast to fall this year and every year

·         Budget to move into surplus in 2018/19

·         The economy has grown by 8% over this parliament

·         Growth is expected at 2.4% next year and then 2.2%, 2.4%, 2.3%, 2.3% ongoing

·         Manufacturing is growing faster than any other sector

·         1,000 new jobs for every day the government has been in office

·         Employment growing fastest in Scotland and the North of England

Spending decisions

·         Increased NHS spending

·         Unemployment benefits ended for migrants with no prospect of work

·         Building a ‘Northern powerhouse’ by road and rail improvements

Business taxation

·         R&D – improvements for both the SME and large company schemes

·         New children’s television tax relief

·         Talks on devolving corporation tax powers to Northern Ireland

·         Banks to lose 50% of tax relief for losses from the financial crisis

·         Reduction in North Sea supplementary charge, and increased reliefs

·         Small business rate relief extended

·         Review of structure of business rates

·         Business rates to be devolved to Wales

Employee taxation

·         National insurance employment allowance extended to carers

Taxation of individuals

·         A modest giveaway on the personal allowance – this will increase next year to £10,600 – an additional £100

·         Increase in higher rate threshold to £42,385 from April. Down-payment on increase to £50,000 in next parliament

·         £50k remittance based charge for non-doms in UK for 12 of the last 14 years increased to £60k; £90k after 17 years in UK out of last 20 years

·         Tax-free status of ISAs will continue after death for spouse – echoes the changes being introduced for pensions on death

Value added tax

·         VAT relief for hospices

Stamp duty land tax (SDLT)

·         Slab system for SDLT abolished for residential properties in favour of ‘slice’ system; highest value properties will be subject to 12% charge

·         Stamp duty reduced for 98% of residential sales

Tax avoidance

·         25% tax on profits shifted out of the UK by multinationals

·         Various detailed anti-avoidance measures – including entrepreneurs relief

·         Action on hybrids and country-by-country reporting is early adoption of measures recommended in OECD’s plan on BEPS

Other taxes

·         Inheritance tax exemption for aid workers who die in line of duty

·         ATED increased for houses above £2 million

·         Fuel duty frozen

·         Air passenger duty abolished for children under 12 (under 16 in future)

 

 





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