Taking to the stand on Wednesday (6 March), Chancellor Jeremy Hunt announced a range of personal measures focused on reducing the tax burden for households.
Just months after a 2p cut to National Insurance contributions (NICs) came into effect in January 2024, the Chancellor declared that taxpayers would see a further 2p cut in April.
Although reports suggested the Prime Minister initially wanted to lower income tax, the decision to reduce NICs was likely influenced by cost: reducing income tax by 1% would have cost £7 billion, while the NI cut is set to cost £4.5bn.
The Government will also abolish the non-dom tax status. Starting in April 2025, new UK arrivals won't pay tax on foreign income for four years. After that, they will pay the same taxes as UK residents.
The Chancellor plans to make the high-income child benefit charge fairer by consulting on changing it to a household system by April 2026. Until then, the income threshold will increase from £50,000 to £60,000 from April 2024, removing 170,000 families from the charge.
Additionally, the higher capital gains tax rate for residential properties will drop from 28% to 24%, which Hunt believes will boost revenues by encouraging more sales.
Talk to us about these changes.