MILLIONS of Britons will get a boost in their bank accounts as Jeremy Hunt today announced tax cuts and benefit rises to get Britain “back on track”.
Mr Hunt promised to “reduce debt, cut taxes and reward work” as he unveiled a package aimed at bailing out cash-strapped Britons and boosting the economy.
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Chancellor of the Exchequer Jeremy Hunt made his Autumn Statement in the House of Commons Credit: PA
He cut National Insurance, increased Universal Credit benefits and raised the minimum wage.
But in a surprise twist, he also raised tax on hand-rolled tobacco – with almost immediate effect – and warned Britons on benefits they should find work within two years or face losing state benefits.
In his autumn statement, Jeremy Hunt announced:
In today’s Tory opening autumn statement, the chancellor cut national insurance by two percentage points from 12% to 10%.
The cuts will affect 27 million Britons and will see a worker on an average salary of £35,000 save more than £450.
A senior nurse with five years’ experience on £42,618 will receive an annual bonus of £600, the Treasury has announced.
And the average full-time nurse on £38,900 will receive an annual increase of over £520.
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An autumn statement at a glance
Emergency legislation will be introduced tomorrow so the major tax change can come into effect on January 6 next year.
Meanwhile, the lowest paid workers saw their minimum wage rise to £11.44.
That’s a pay rise of more than one pound for more than three million Britons.
Ahead of the Christmas party season, the chancellor cheered up drinkers by announcing that alcohol tax would remain frozen.
In a major win for our Save Our Sups campaign, beer, wine and spirits duty will not rise – and pubs and bars have had their 75 per cent annual holiday extended.
As MPs welcomed the freeze in the House of Commons, Hunt said: “I know for many people it has become more expensive to go to the pub.
“I listened carefully to the persuasive arguments about alcohol taxes by (colleagues) and indeed The Sun newspaper.”
While drinkers cheered, smokers took a big hit as the Chancellor increased taxes on hand-rolled tobacco by 10%.
The price of a pack of cigarettes will also jump under a regular inflation rate of 2%.
Once nicknamed Scrooge for his miserly management of public money, the chancellor used more than expected borrowing to finally ease the pain in bookies’ wallets.
After three years of festive trade devastated by Covid and then strikes, the move has kicked off the Christmas party season as the Tories desperately try to reverse their poor poll ratings.
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The state pension will increase to 8.5 percent in April
Mr Hunt said: “In today’s Autumn Growth Statement our choice is not big government, high spending and high taxes because we know that leads to less growth, not more.
“Instead, we reduce debt, reduce taxes and reward work.
“And we’re supporting UK business with 110 growth measures.”
With the triple lock intact, the State Pension rose by 8.5 per cent, keeping pace with the usual income measurement.
And the applicants received allowances in line with September’s inflation of 6.7 percent.
The chancellor considered choosing a lower inflation figure of 4.6 per cent for October as it would save the government around £3bn.
Local Housing Allowance has also been unfrozen, giving 1.6 million households an average of £800 in extra support on top of next year’s rent.
But that desire for carrots came with a thick stick.
If after two years of “intensive support”, Britons receiving benefits do not find work, they will be put on compulsory work placements to improve their skills and improve their employability.
If they choose not to participate in the job search process for six months, their benefits will be cut off completely.
Britons with mobility and mental health problems also risk a reduction in Universal Credit if they fail to find work they can do from home.
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Changes in national living income since 2016
Strict new rules will apply to all new benefit claimants from 2025, and existing ones will be given guarantees that their entitlement to benefits will not be reassessed if they claim work from home.
It said the decision was based on evidence that more than half of those in the group of 2.4 million sick and disabled people who want to work do not because they are worried they will be reassessed if they fail.
The chancellor said: “The opposition party tried to reduce poverty by tinkering with benefits and tax relief.
“They wanted to move people from the poverty line to a level above it.
“But conservatives know that the best way to solve poverty is to work.
“By reforming the welfare system, reducing the number of households without work and tackling low pay, we have helped lift 1.7 million people out of absolute poverty since 2010, as making work pays is central to our plan to grow the UK economy.”
Mr Hunt updates the government’s finances twice a year to boost business investment by £20bn a year.
Businesses have seen the relief scheme which allows them to claim every penny they invest against their tax bills made permanent at a cost of more than £10bn a year.
Mr Hunt said: “Under Labour, business investment was 9.3% of GDP in real terms.
“Taken together, the overall effect of today’s growth measures will be to increase business investment in the UK economy by around £20 billion a year within a decade, almost 1% of GDP at today’s levels.
“It’s the biggest boost to business investment in modern times, a decisive step towards closing the productivity gap with other major economies and the most effective way we can raise wages and living standards for every family in the country.”
While the overall tax burden will be lower by 0.7 percent of GDP based on the autumn report, it still retains less than a quarter of the increase in taxes from the fiscal burden.
There have also been £19 billion worth of real spending cuts, with Britain’s tax burden predicted to continue to rise until the end of the decade.
The government’s economic watchdog, the Office for Budget Responsibility, also says households will experience the biggest drop in living standards since the 1950s.
Shadow chancellor Rachel Reeves slammed the autumn statement as “leaving working people worse off” after “13 years of economic failure under the Conservatives”.
She said: “Shop prices are still rising, energy bills are higher and mortgage payments are higher after the Conservatives wrecked the economy.
“The Conservatives have become the party of high taxes because they are the party of low growth.
“Nothing the Chancellor says or does in his Autumn Statement can change their appalling record.”
Liberal Democrat Treasury spokeswoman Sarah Olney MP said: “This is a travesty by Jeremy Hunt after years of cruel tax increases on hard-working families by this government.
“Conservative chaos has sent mortgages and taxes soaring, today’s announcements won’t even touch the sides.
“There was more stale nonsense today than an out-of-touch, out-of-idea Conservative government.”
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Leader of the House of Commons Penny Mordaunt, Prime Minister Rishi Sunak, Chancellor of the Exchequer Jeremy Hunt sit down after delivering the Autumn Statement Credit: PA
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The chancellor reduced taxes and increased the minimum wageCredit: PA
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The Chancellor has spent months in Number 11 preparing for today’s announcements Credit: Kirsty O’Connor / Treasury
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