The Budget: Key Points

The Chancellor has delivered the Budget: Key points including changes that will affect all of us are included below:

Photo by Suzy Hazelwood

Shop and pub owners

A new 50% business rates discount will apply in the retail, hospitality and leisure sectors. Eligible businesses will be able to claim a discount on their bills of up to a maximum of £110,000. The temporary relief rate will take place for 2022-23 and be worth around £1.7billion.

Workers on the minimum wage

The minimum wage will rise to £9.50 an hour for those aged 23 and over next April. Likewise, the National Living Wage will increase from £8.91 to £9.50 an hour, a 59p an hour boost. For those aged 21-22 the National Minimum Wage rate will rise to £9.18 an hour, up from £8.36 – an 82p increase.

Apprentices in industries like construction will see their minimum hourly pay increase by nearly 12%, going from £4.30 to £4.81 an hour. However, for many workers this will be eroded by a new National Insurance hike next April. There will aslo be a 3.1% jump in the cost of living. The tax will begin as a 1.25% rise in National Insurance from April 2022, paid by both employers and workers. All working adults, including those over the state pension age, will pay the levy.

Drinkers and smokers

The price of a pack of cigarettes has risen across all retailers as the duty rates on cigarettes has increased by the rate of RPI inflation plus 2%. Similarly, the rate on hand-rolling tobacco has increased by RPI inflation plus 6%.

If fortified wine or high strength white cider are your tipple of choice, your drinks bill is about to go up. The Government will increase tax on these because of their high alcohol content. Lower alcohol drinks such as fruit cider, liqueur and rose wine will have lower taxes. Small producers of craft cider will be eligible for tax relief for the first time and draught beer served in pubs will also see a duty cut. These reforms will come into effect in February 2023.

Motorists and holidaymakers

Mr Sunak said he would freeze fuel duty at 57.95p per litre for the year ending March 2023. The decision comes after petrol prices hit their highest point in eight years late last week.

Controversially, days before the UN climate change summit in Glasgow, the Chancellor also said he would cut air passenger duty for domestic flights by 50% to £6.50. However, a new levy will come into place for those who travel 5,500 miles or more to destinations such as Japan, Australia and South Africa. The new £91 duty means the amount of tax you pay will depend on how far you’re flying.

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