Budget 2018 - Vertice Services
Rodolfo Basilio No Comments

On Monday 29th October 2018, Mr Philip Hammond delivered UK Budget 2018. He declared that Britain era of austerity was “finally coming to an end”. He also said that “We are at a turning point in our history and we must resolve to go forwards, not backwards”.

Mr. Philip Hammond delivered a budget with a positive contribution for all UK taxpayers.

Follow below UK budget main points :

  • Income tax threshold raised to £12,500 a year and higher-rate tax threshold to £50,000 next April – The Government said that it amounted to a tax cut for 32 million people;
  • Business rates cut by one-third for small businesses, aimed at struggling high streets retailers – Business rates are to be cut by one-third for the next two years from next April for all retailers in England with a rateable value of £51,000 or less. The Government said that this would deliver an annual savings of up to £8,000 for up to 90 per cent for all independent shops, pubs, restaurants and cafes;
  • National Living Wage increased to £8.21 earlier than planned (next April);
  • Extra £27.6b a year confirmed for NHS by 2023-24;
  • Duty on beer and spirits frozen for a year, but not on wine;
  • Digital Services Tax aimed at big tech companies to raise up to £400 million – Amazon, Google, Facebook and other internet giants will face a new “digital services tax” of 2% of revenue generated in UK;
  • Up to extra £1.7b a year to ease rollout of universal credit and extra £1b for defence over 2 years;
  • Extension of the new IR35 system from the public to the private sector – Private sector contractors deemed to be employees must pay National Insurance;
  • Businesses including supermarkets will for the first time be taxed for using plastic that is not at least 30 percent recycled;
  • First-time buyers who buy with shared ownership will pay less stamp duty – First time buyers purchasing shares equity home of up to £500,000 to be exempt from stamp duty;
  • The Office for Budget Responsibility upgraded its forecast for GDP growth in 2019 from 1.3% to 1.6%; then 1.4% in 2020 and 2021; 1.5% in 2022 and 1.6% in 2023;
  • Borrowing is expected to be £11.6 billion lower than forecast by the chancellor in the spring statement;
  • The tax on online “games of chance” will be increased to 21 per cent from October next year;
  • Extra £1 billion for the Armed Forces;
  • Another £650 million for social care and £45 million for disability services;
  • One-off fund of £400 million to pay for school equipment;
  • Some 800,000 more jobs forecast by 2022, with wages growth highest in a decade;
  • Extra £500 million for preparations for leaving the EU;
  • Increase of Annual investment allowance from £200,000 to £1 million;
  • Introducing a permanent tax relief for new non-residential structures and buildings;
  • Support British Exports: Increase UKEF direct lending facility by up to £2 billion;
  • Extending start-up loans funding to 2021 (support extra 10,000 entrepreneurs);
  • Keep previous year VAT Threshold;
  • Make HMRC a preferred creditor in business insolvencies.