Spring Budget: what it means for your pocket and the planet

Written by Lori Campbell on 6th Mar 2024

As chancellor Jeremy Hunt unveils the final Budget before a general election, we look at what it means for your personal finances – and the planet.

Personal finance

National Insurance cut by 2p

National insurance contributions will be reduced from 10 per cent to eight per cent. This repeats an identical measure announced in last year’s Autumn Statement. Hunt says the cut is worth about £450 a year for someone on a £35,000 full-time salary.

There will also be a 2p cut for self-employed people, taking their contributions from eight per cent to six per cent.

Child benefit ‘tax trap’ changed

The point at which parents are charged for claiming child benefit will rise from £50,000 to £60,000 and the top of the taper where it is withdrawn entirely will be increased to £80,000. Hunt says the move will save 500,000 families an average of £1,260 a year.

There will also be a consultation on a new rule to make the benefit apply to household income, rather than individual.

Household Support Fund extended for six months

The Household Support Fund, which funds local councils to help vulnerable households pay for essentials such as energy and water bills, rent, food, has been extended by six months to September 2024.

A new British ISA for savers

The new British ISA will allow people to invest up to £5,000 more per year tax-free in London-listed companies. This is on top of the existing £20,000 ISA annual allowance.

New fixed-rate British Saving bond

A new British Savings Bond with a fixed rate for three years will be offered by state-owned savings bank National Savings and Investments (NS&I). However, Hunt did not specify what the rate will be.

Vaping and smoking more expensive – but not the pub

From 2026, a new “vaping products levy” must be paid on imports by manufacturers, specifically on the liquid in vapes. The move is an attempt to discourage children from buying vapes. There will also be a one-off increase in tobacco duty.

Alcohol duty, meanwhile, was set to rise by three per cent from August but will now be frozen until February 2025. Hunt says this will benefit 38,000 pubs across the UK.

Fuel duty frozen

Fuel duty is to be frozen at its current level for another year. The levy should rise in line with inflation but this has not happened since 2011. A five pence cut to fuel duty, which was introduced in 2022 and is due to run out this month, has been extended.

Childcare help to encourage parents back to work

Rates paid to nurseries to fund free childcare hours for parents of children aged over nine months will continue for another two years. Hunt says this will allow an extra 60,000 parents to re-enter the workforce in the next four years.

The planet

Policies for the planet were noticeably scant in this Budget.

Tax hike on business class flights

The rate of tax paid on “non-economy flights” is to be increased, although Hunt did not say by how much.

£120m for clean energy

There will be another £120 million in funding for the Green Industries Growth Accelerator (GIGA) programme to build supply chains for new green technologies. These range from offshore wind to carbon capture and storage. Meanwhile, the government will spend £160 million on two nuclear sites.

Windfall tax on fossil fuel firm profits extended

The 35 per cent surcharge on profits on oil and gas companies due to high energy prices has been extended to March 2029.

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