UK government unveils 'autumn statement for growth'

22nd November 2023


Chancellor Jeremy Hunt unveiled the “biggest permanent tax cut in modern British history” in his autumn statement today, as well as significant investment for the net-zero transition.

He said that the UK will have both the lowest headline corporation tax rate in the G7 and the most generous capital allowances in the OECD after announcing “permanent full expensing” for firms that invest in IT equipment, plant, and machinery.

The Climate Change Agreement Scheme will also be extended, giving carbon-intensive businesses around £300m of tax relief every year until 2033 to encourage investment in energy efficiency and support the net zero-transition.

Manufacturers in the “high-growth industries of the future” will receive £4.5bn, including £960m for the Green Industries Growth Accelerator to support clean energy.

Furthermore, a business rates support package worth £4.3bn will be implemented over the next five years, with the policy measures announced today expected to unlock £20bn of extra annual business investment over the next decade.

Hunt said: “I have today delivered the biggest business tax cut in modern British history with the most competitive investment allowances of any large economy.”

The government has also published its full response to the Winser review and Connections Action Plan, which it says will cut grid access times for larger projects by half, halve the time to build major grid upgrades, and offer up to £10,000 off electricity bills over 10 years.

And following the announcement of its plans to relax laws on nutrient pollution to boost house building, Hunt pledged £110m of nutrient mitigation funding, and unveiled plans to allow local authorities to recover the full costs of major planning applications.

The chancellor also announced a further £50m of funding for skills and training over next two years to increase apprenticeships in sectors like engineering.

On work and welfare, he said that the national living wage will increase by 9.8% to £11.44 an hour for eligible workers, including 21 and 22-year-olds for the first time, and there will be a national insurance (NI) tax cut from 12% to 10% for 27 million working people from January.

Despite these measures, the GMB Union said that they would go "nowhere near fixing the damage" done to people’s finances over recent years.

General secretary, Gary Smith, said: “The cut to NI will mean just over £150 a year to the lowest paid; a drop in the ocean when mortgages have doubled and energy bills are crippling household finances.”

Meanwhile, others were left disappointed by what they felt was a lack of leadership from the chancellor on climate change.

Christian Aid’s policy, public affairs and campaigns director, Osai Ojigho said: “Had we seen leadership today, we would have seen a chancellor adopt a ‘polluter pays’ principle to raising taxes on fossil fuel giants and the extremely wealthy to tackle the climate crisis.

“We would have seen a chancellor tackle global inequality by agreeing to legislation to get debts cancelled for the poorest countries.

“We didn’t see leadership today. It leaves people to ask how the government’s new international development strategy, published this week, will be realised.”

Image credit: Shutterstock

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