Delivering his first Budget in the House of Commons, Chancellor Rishi Sunak laid out the government’s plans for the year ahead.
Housing & transport links
By mid-2025, more than £600bn is set to be spent on transport links such as roads and rail, plus housing and broadband.
£27bn of that will be set aside for motorways and other arterial roads, while £2.5bn will be made available to fix potholes and resurface roads in England.
Stamp duty surcharge for Foreign buyers of properties in England and Northern Ireland will see the stamp duty surcharge levied from April 2021 at 2%.
In addition, following the devastation of Grenfell, a new £1bn fund was announced. This funding will be used to remove all unsafe combustible cladding from all public and private housing higher than 18 metres.
The NHS was a clear winner in the latest Budget with £6bn in extra funding promised over the next five years. This money is set to pay for staff recruitment and start the upgrade of hospitals. In addition, a £5bn emergency response fund has been allocated to support the NHS and additional public services in England. However, many see this as the government reversing the cuts made during austerity measures.
There is good news for consumers though with the tax threshold for National Insurance Contributions to rise from £8,632 to £9,500 which means that half a million employees will be removed from being taxed. It also means that for those earning £9,500 per year, will be – on average - £85 better off each year.
A great result for women everywhere was the abolition of the ‘tampon tax’ which previously meant that women’s sanitary products incurred VAT of 5%.
Fuel & lifestyle
When it comes to fuel, for the tenth consecutive year fuel duty has been frozen; as has duties applicable to beer, cider, wine and spirits. However, tax on tobacco will rise another 2% above the rate of retail price inflation. In real terms, this means that the price of a pack of 20 cigarettes will rise by 27 pence while 14 pence will be added to a packet of cigars.
Plastic consumption – which has preyed on the minds of consumers and activists – also sees a positive change, as announced in the Budget. A new plastic packaging tax is due to come into force from April 2022 which will mean that manufacturers and importers whose products have less than 30% recyclable material will face a fee: £200 per tonne. A good step forward in helping to eradicate single use plastic.
Communities have been left devastated by recent storm flooding and Sunak announced that £120m in emergency relief will be provided for English communities affected. £200m is also being made available to put towards flood resilience plans, with flood defences in England set to double to £5.2bn over the next five years.