Weds 6th November 2024
The new Labour government, with a large public mandate, laid the groundwork for last week’s budget by repeatedly pointing out they had been left with a large “financial black hole” of about £22bn. This promised a budget that was likely to be challenging for many. David Meredith of Busbys Chartered Accountants took the group through some of the detail.
Facing a significant deficit in income vs expenditure, and not wanting to increase borrowing significantly since the country’s debt approaches 100% of its income, the government needed to find ways to significantly boost their tax take if they were to fulfil their spending promises on healthcare and elsewhere. Bearing the brunt of the government’s desire to raise income was Employer’s National Insurance, with an increase to 15%, starting at a lower level of earnings.
Other increases include Capital Gains Tax on profits on assets other than residential property, Stamp Duty and Inheritance Tax.
Employers will also need to cover the cost of the National Living Wage which rises significantly and there are even larger increases to the National Minimum Wage to bring younger workers in line with those over 21. The Chancellor also announced State Pension increases, a further freeze in Fuel Duties, a minor reduction in duty on draught drinks, and an extension of the discount on business rates for hospitality/retail/leisure sectors, albeit at lower levels than before.
David’s presentation can be seen below, and Busbys regular newsletter is a great source of detailed information.
