How different this Autumn Statement was compared to previous years, where Jeremy Hunt reversed the vast majority of the announcements made in the mini budget by Kwasi Kwarteng and Liz Truss back in September 2022.
Following the turmoil caused by the mini budget last year with a number of unexpected announcements made which took the markets by surprise, this statement had no such issues.
With the UK’s economic and fiscal outlook being much more positive compared to a year ago, the chancellor has proposed a number of taxation cuts.
The major change announced was around National Insurance Contributions (NIC) for both the employed and self-employed.
For the self employed, the Class 2 NIC has been abolished completely and the rate of Class 4 NIC has been reduced from 9% to 8%. This is a welcome saving for the self-employed.
For those individuals employed by a business under PAYE, the main rate of Class 1 NIC has reduced from 12% to 10%. This reduction translates into a saving of up to £754 per annum. The chancellor hopes that the reduction in the Class 1 NIC rate will be effective from 6th January 2024, so we can benefit earlier. I do, however, have some concerns around the timescale as with Christmas coming up, this only leaves a few weeks for payroll to be corrected.
The savings generated by the cuts to National Insurance will help ease the ‘cost of living crisis’ and in some peoples circumstances, an element of this can be spent in our local pubs where the alcohol duty will remain frozen at current levels.
Luke Mitchell – Senior Manager