The Autumn Budget 2017 – a short summary
1st December 2017
Philip Hammond delivered his second Budget as Chancellor on 22nd November, the first to arrive in the new Autumn slot. It’s also the first Budget since the snap General Election held earlier this year which ultimately backfired for Theresa May. Between that and the less than favourable reports of the progress being made in the ongoing Brexit talks with the EU, this was therefore an important moment for the Chancellor to restore some of the faith that may well have been lost in the government during 2017. So, how did he do?
One of the biggest announcements from Mr Hammond was the abolition of stamp duty for first-time buyers in England, Wales and Northern Ireland when purchasing a property up to the value of £300,000. For those looking to get on the property ladder in more expensive areas of the country, such as London, properties worth up to £500,000 will have the first £300,000 exempt from stamp duty, with the next £200,000 seeing the tax charged at 5%. The move will help 95% of all first-time buyers, with 80% paying no stamp duty at all.
There were also announcements regarding personal tax and wages, with the tax-free allowance on income tax set to rise in line with inflation to £11,850 in April next year. The threshold for higher-rate tax will also go up to £46,350. The National Living Wage will increase to £7.83 per hour at the same time, a 4.4% rise from the current hourly figure of £7.50.
The Chancellor also gave some positive news for businesses, with the announcement that business rates will be based on the Consumer Price Index (CPI) rather than the Retail Price Index (RPI) from April 2018. The was originally planned for two years later but bringing this change forward is estimated will save businesses around £2.3 billion. Small businesses will have also been glad to hear that the VAT threshold will stay at the current value of £85,000 for the next two years.
A number of investment plans were unveiled by Mr Hammond, including £500 million to support 5G mobile networks, full fibre broadband and artificial intelligence, and £540 million to help with the expansion of electric cars. Underperforming schools in England will receive support wirth £1,000 per teacher, thanks to a £40 million teacher training fund and £84 million will be spent on recruiting 8,000 more teachers of computer science.
Health services also received a boost to the tune of £2.8 billion additional funding for the NHS in England, with £350 million to be received immediately to help during the coming winter months. £1.6 billion will then be allocated for 2018-19, and the remaining money will be provided in 2019-20.