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Spring Statement 2019

The traditional Spring Budget has been replaced by a smaller Spring Statement this year. Autumn’s main Budget will be when the Chancellor announces major tax and spending changes, and any other new measures. There was all the familiar ifs, buts and maybes around Brexit, and much of the forecasting hinged around whether or not there would be a deal or no deal Brexit.

Here are the key points from today’s Spring Statement.

  • – GDP growth forecast 1.2% for 2019, then 1.4% in 2020
  • – Borrowing forecast £29.3bn in 2019-20, and reducing each year
  • – The chancellor wants to “build an economy that works for everyone”, including “getting rid of low productivity and low wages”
  • – A full spending review is to be concluded before the Autumn 2019 budget
  • – Public finances of up to £26.6bn can be used in the event of a no deal Brexit
  • – The National Living Wage from April 2019 is set at £8.21, with a projection of £8.62 in 2020
  • – 600,000 new jobs to be created by 2023
  • – Free sanitary products in schools from September 2019
  • – £100m to be made available to police for the fight against knife crime
  • – £200m to be spent supporting science, innovation and industry
  • – The Chancellor revisited the Autumn Budget 2017 proposal to create 300,000 new homes each year, with a £44bn budget
  • – 60,000 first time buyers have benefitted from the Stamp Duty relief
  • – The apprenticeship levy to be halved, from 10% to 5%
  • – £53m of funding to be made available for funding full fibre networks in a further 9 areas of the country (including Isle of Wight)

The Spring Statement was also an opportunity to announce other proposed measures that the Government are seeking views on. The Chancellor announced several tax consultations that are likely to appear in the Autumn Budget or change in the future:

  • – A review into the taxation of large digital businesses – again
  • – A review of offshore tax compliance strategies
  • – Tackling tax avoidance, evasion, and other forms of non compliance. The government is publishing a policy paper setting out the their achievements so far
  • – Offshore oil and gas decommissioning industry – what should be done to strengthen the UK’s position
  • – Preventing abuse of the R&D tax relief. A consultation will focus on how measures are to be applied
  • – Making Tax Digital – focus to be on supporting businesses through the MTD transition. The April 2020 target for income tax still seems to be on the cards
  • – Draft legislation for Structures and Buildings Allowance
  • – Proposed reform of Employment Allowance regulations. Should only impact on the largest employers

Plenty to mull over, but the devil of course will be in the Autumn Budget detail.