Budget Speculation: What to Expect Next Wednesday

As the budget approaches, Chancellor Jeremy Hunt is facing pressure to make key decisions that could impact the economy. Here's a roundup of what we can expect and what various industry bodies are pushing for.


As the budget approaches, Chancellor Jeremy Hunt is facing pressure to make key decisions that could impact the economy. Here's a roundup of what we can expect and what various industry bodies are pushing for.

Tax Cuts: A Pre-Election Giveaway?


Tory MPs are urging Mr. Hunt to consider tax cuts, with hints that he may have something up his sleeve as a pre-election gesture. However, concerns over government debt and recession may limit his capacity to deliver. Economists predict he may have around £25bn to work with.

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National Insurance Cut: A Cheaper Alternative


A potential 1p cut in national insurance could be on the table, costing around £5bn. This option is being considered after plans for a 2p income tax cut were deemed unaffordable. The Office for Budget Responsibility has raised concerns about the inflationary impact of such a move.

Scrapping 'Nom-Dom' Tax Breaks


Mr. Hunt is contemplating eliminating tax breaks for UK residents with non-domicile status, allowing them to avoid paying tax on overseas income. This move, once a Labour pledge, could affect around 68,800 individuals in the UK, including the Prime Minister's wife, Akshata Murty.

Vape Duty: Making Habits Unaffordable


A potential "vaping products levy" is under consideration to discourage the use of vapes among children. This levy, paid on imports and by manufacturers, aims to address concerns about the affordability of vaping products for young people.

First-Time Buyer Support: A Shift in Plans


Initial proposals for a 99% mortgage scheme have been scrapped in favor of other options. Lenders have expressed concerns about potential defaults among borrowers, prompting a reevaluation of this plan. Industry experts are calling for policy changes to aid those looking to purchase homes.

Car Industry Appeals for Support


The UK car industry is seeking assistance to facilitate the transition to electric vehicles. Calls have been made to reduce VAT on new EVs and maintain the freeze on fuel duty. Additionally, requests have been submitted to lower taxes on greener vehicles and reduce insurance premium tax.

Hospitality Industry Demands Action


Hospitality industry bodies are urging for a cut in VAT on food and drink to alleviate financial strains on struggling firms. This move could provide much-needed relief to businesses facing ongoing challenges.

Speculation Over Inheritance Tax


There is speculation that Mr. Hunt may consider abolishing inheritance tax, a move that could have significant implications given its contribution to public revenue. Scrapping this tax would represent a bold decision with potential electoral consequences.

Overhaul of Lifetime ISA Rules


Potential changes to Lifetime Individual Savings Account (LISA) rules are being explored to promote homeownership. Suggestions include increasing the property purchase limit and reducing penalty charges to enhance the attractiveness of the scheme.

Child Benefit Reform on the Horizon


Proposed reforms to the high income child benefit charge could see adjustments to the threshold at which it applies. Raising the threshold could offer relief to families impacted by the current regulations, with potential cost implications to consider.

With the budget fast approaching, Chancellor Jeremy Hunt faces critical decisions that could shape the economic landscape. Stay tuned for updates on the developments and implications of these potential changes.

Mohamed Rahat

Hey there, I'm Mohamed Rahat, your go-to writer for all things business and economy. Originally from Mumbai, now rocking it in Navi Mumbai. With a past life at Tata Power Co. Ltd., I'm here to unravel the mysteries of the economic world, one article at a time. Stick around for some mind-bending insights! Connect With Me