Home Business Autumn Statement 2023: When is it and how will it affect me?

Autumn Statement 2023: When is it and how will it affect me?

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The government will shortly announce its tax and spending plans for the year ahead.
The Autumn Statement affects the take-home pay and household budgets of millions of people, as well as setting out how much will be spent on key public services.
Chancellor Jeremy Hunt will deliver the Autumn Statement in the House of Commons on Wednesday, 22 November 2023.
The speech usually happens at lunchtime.
The Autumn Statement is one of the key financial events in the political calendar.
The chancellor updates MPs on the country's finances and the government's tax and public spending plans, based on the latest forecasts from the Office for Budget Responsibility (OBR).
The independent OBR, which checks the health of the economy, will present its own assessment of Mr Hunt's plans to Parliament.
Inflation is still high
Inflation – the rate at which prices rise – has fallen sharply since the high of 11.1% in October 2022, but households are still being squeezed.
The CPI measure of inflation was 4.6% in the year to October – down from 6.7% in September.
In January, the government pledged to halve inflation by the end of 2023.
The October CPI figure suggests it will do this, but the rate of inflation is still be more than double the Bank of England's target of 2%.
Growth has stalled
The Bank of England increased interest rates 14 times since 2021 to get inflation under control, but there are concerns the rises have weighed on economic growth.
Growth stalled between July and September, official figures show.
The Bank says the UK is likely to see zero growth until 2025, and has said interest rates will remain high – and may even rise further.
Government borrowing is soaring
Government borrowing costs have been mounting, meaning the Treasury has to pay back more in debt interest.
Some think that may leave Mr Hunt with less money to spend on public services, or make it harder to cut taxes.
However, official figures showed that government borrowing in September, while high, came in lower than most economists had expected, leading some to suggest the chancellor may have more room for giveaways than previously thought.
Income tax cuts
The chancellor is under pressure from his party to cut taxes.
On Sunday, Mr Hunt told the BBC's Sunday with Laura Kuenssberg that he wanted to put the UK on "the path to lower taxes" but would "only do so in a responsible way" that did not "sacrifice the progress on inflation".
When asked if he would cut income tax, he said he would not comment on a decision ahead of the statement.
A report in the Sunday Times said that cuts to income tax or national insurance were being considered by Mr Hunt.
The government should set out how much pensions will rise by from April 2024.
Under the so-called triple lock, the state pension is supposed to increase by the highest out of inflation (as measured by CPI the previous September), average earnings, or 2.5%.
This year, earnings growth is highest at 8.5%. But the Treasury may not honour that figure.
Instead, ministers may use earnings data that strips out the impact of bonuses and one-off payments. That would mean an increase of 7.8%, saving about £1bn.
Tougher benefits rules
Under the government's Back To Work Plan benefit claimants who fail to find work for more than 18 months will have to undertake work experience placements.
If they refuse they will lose access to their benefits for a period,under the rules that will be announced in the Autumn Statement.
There has also been speculation that the government could change how it sets the rate at which benefits increase for the next financial year. It is a move that could save billions of pounds for the Treasury but could also squeeze households on low incomes.
Traditionally, the inflation rate in September is used and this year it was 6.7%. But the government could instead base the increase on October's lower rate of 4.6% in order to save money.
First-time buyers
The government is considering expanding its mortgage guarantee scheme to help more first-time buyers borrow with a 5% deposit.
The scheme was extended for 12 months to finish in December 2023, but may continue for another year.
Green stamp duty rebate
New homeowners who make their properties more energy efficient within two years could receive a partial stamp duty rebate, according to the Telegraph.
The plan was recommended by the Energy Efficiency Taskforce, which the chancellor set up in last year's Autumn Statement.
Inheritance tax and stamp duty
Despite Mr Hunt having publicly ruled out tax cuts, ministers are apparently exploring a possible cut to inheritance tax (IHT).
IHT is currently charged at 40% over the tax-free threshold of £325,000, but the press reports have suggested ministers are considering reducing the rate or scrapping the tax.
Meanwhile, the i newspaper reported a cut to stamp duty was being considered.
Individual savings accounts (ISAs)
Reports suggest the chancellor may shake up the tax-free individual savings account (ISA) market.
He could launch a combined cash-and-shares Isa to encourage more investment in the UK stock market.
Some parts of the Autumn Statement affect the whole of the UK.
However, the governments of Scotland, Wales and Northern Ireland also make some tax and spending decisions independently – although Northern Ireland doesn't currently have a functioning executive.
If the Westminster government announces extra spending for England, the other nations get an equivalent extra sum of money.
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