Autumn Budget Summary 2024

Autumn Budget 2024

Our Autumn Budget summary link is below and includes all the key points, tax updates and facts and figures you need to know.

The first Budget from a Labour government since March 2010, and the first ever from a female Chancellor was a highly anticipated event. When Rachel Reeves revealed a £22 billion deficit and introduced a reduction for the winter fuel payment in late July, it was clear her Budget would be challenging for both the government and the public.

As Budget day neared, talk of the black hole was replaced by a steady flow of rumours about tax increases and also, to a lesser extent spending cuts. Additionally, there were suggestions that government borrowing – already overshooting the March 2024 Budget projections by around £7 billion – would rise by £20 billion to fund NHS and infrastructure projects.

In the event, the Chancellor delivered tax increases amounting to £41 billion by 2029/30. By far the largest element of this was the expected rise in employer’s national insurance contributions (NICs). The 1.2 percentage point rate increase, combined with a £4,100 cut in the secondary threshold will yield nearly £25 billion a year by 2028/29. At that level it more than counters the cost of the cuts to employee and self-employed NICs introduced by Jeremy Hunt.

Other significant tax increases included higher capital gains tax rates and a future reduction in inheritance tax business and agricultural reliefs. Despite the additional revenue, the Office for Budget Responsibility (OBR) projects that increased spending will mean that borrowing will still be over £70 billion in 2029/30. Not without reason does the OBR say, “…this Budget delivers a large, sustained increase in spending, taxation, and borrowing”.

Approver: Quilter Financial Limited, November 2024.