The Chancellor of the Exchequer, Philip Hammond MP, delivered his Spring Budget to the House of Commons on 8 March 2017. The Budget included a number of announcements that will impact on Northern Ireland.
The Office for Budget Responsibility upgraded its growth forecast for 2017, predicting 2% growth for the UK economy.
Forecasts for subsequent years are as follows:
- 2018/19 – 1.6%
- 2019/20 – 1.7%
- 2020/21 – 1.9%
- 2021/2022 – 2%
Inflation is forecast to rise to 2.4% in 2017/18. It will then fall to 2.3% and 2% in subsequent years.
The announcements made in the 2017 Budget will deliver almost £120m in additional funding for the Northern Ireland Executive. This will represent approximately £90m in additional Resource spending by 2019/20 and £30m in additional capital spending by 2020/21.
- As previously set out, the rate of Corporation Tax in the rest of the UK will be cut to 17% by 2020.
- In April 2018, Class 4 National Insurance Contribution payments for self-employed people will increase to 10%, rising to 11% in April 2019. This will raise £145m a year by 2021/22, and will cost those affected 60p per week on average.
- The personal tax-free allowance will rise to £11,500 this year and to £12,500 by 2020.
- A new minimum excise duty on cigarettes will be introduced, based on a pack price of £7.35. Elsewhere, there will be no changes to previously planned upratings of duties on alcohol and tobacco.
- Vehicle excise duty for hauliers, along with the HGV Road User Levy, will be frozen from 1 April 2017.
An expert panel will be established to explore the use of tax incentives to help North Sea oil and gas operators sell oil/gas fields.
The UK Government will investigate ways to protect consumers from unnecessary costs and inefficiencies, including:
- Preventing consumers being charged unexpectedly when a subscription is renewed or a free trial ends.
- Making terms & conditions simpler and clearer, including in digital contracts.
- Fining companies that mislead or mistreat consumers.
To read the 2017 Budget in full, please click here.