- UK Chancellor Hunt announced plans to reduce debt and cut taxes, with the Office for Budget Responsibility (OBR) assessing that these measures will lower inflation and boost GDP.
- The Chancellor intends to reduce business taxes.
- Welfare benefits will be increased by 6.7%, aligning with expectations.
- There will be increased support for housing costs through the local housing allowance.
- UK Chancellor Hunt has announced a freeze on all alcohol duties until August 1st, 2024
- TO increase pension allowance by the full triple lock commitment of 8.5%
- The headline debt is expected at 94% of GDP by the end of the forecast horizon (FY 27/28)
- To create new simplified R&D tax relief
- Will sell NatWest shares back to retail investors
- UK to extend 75% business rated discount for retail, hospital and leisure.
- To make full expensing tax breaks for business will be made permanent
- Reduces the main 12% rate of employee national insurance to 10% (to same $450 per average worker.)
- The UK's Office for Budget Responsibility (OBR) confirms that the target of Public Sector Net Borrowing (PSNB) below 3% in the 2028/29 reference period has been achieved.
- The fiscal headroom is noted at GBP 13 billion, which is significantly lower than the post-2010 average of GBP 29.7 billion typically available to Chancellors.
- The medium-term fiscal outlook has seen a considerable improvement compared to the situation in March 2023.
- The fiscal headroom of GBP 13 billion is largely attributed to the rolling nature of the budget rule, which provides an additional year.
- The tax burden is projected to increase annually, reaching a post-war high of 37.7% by the fiscal year 2028-29.
UK OBR Forecasts for CPI (Consumer Price Index) Year-over-Year:
- 2023: Expected at 7.4%, with a March 2023 estimate of 6.1%.
- 2024: Forecast at 2.8%, compared to an expected 3.0% and a March 2023 estimate of 0.9%.
- 2025: Projected at 2.0%, aligning with an expected 2.0% and a March 2023 figure of 0.1%.
- 2026: Expected at 2.0%, with a March 2023 estimate of 0.5%.
- 2027: Anticipated at 2.1%, with a March 2023 estimate of 1.6%
UK OBR Forecasts for GDP Growth:
- 2023: Projected at 0.6%, compared to an expected 0.4% and a March 2023 forecast of -0.2%.
- 2024: Estimated at 0.7%, against an expectation of 0.4% and a March 2023 forecast of 1.8%.
- 2025: Forecast at 1.4%, closely aligning with an expected 1.3% and a March 2023 prediction of 2.5%.
- 2026: Anticipated at 1.9%, compared to an expected 1.7% and a March 2023 forecast of 2.1%.
- 2027: Projected at 2.0%, against an expectation of 1.6% and a March 2023 estimate of 1.9%.
- 2028: Forecast at 1.7%
