Spring Budget 2023: What announcements can you expect

The Chancellor of the Exchequer will present his Spring Budget 2023 to Parliament on Wednesday 15^th March 2023. The Office for Budget Responsibility (OBR) will publish revised forecasts for the economy and public finances on the same day.

What is the Spring Budget 2023?

The Spring Budget is a fiscal statement where the chancellor provides an update to the House of Commons and the public on the state of the UK economy and announces any plans for spending and taxes. Accompanying the statement is a forecast from the OBR, which analyses the impact of government policies and provides predictions for the economy’s future health. There is usually one Budget each year, plus another fiscal statement, for example, a Spring Budget and an Autumn Statement.

When is the Spring Budget 2023?

Jeremy Hunt will unveil his Spring Budget on Wednesday 15^th March 2023. The Budget speech is usually delivered to parliament at around 12.30 pm, following the prime minister’s questions. The speech is accompanied by a budget document containing detailed policy changes, consultations, and policy papers published on the Treasury website.

What announcements can you expect?

The focus of this year’s Spring Budget 2023 is believed to focus on the government’s plans to get the economy growing faster, and it is unlikely to include many if any, short-term tax cuts as this will likely fuel inflation. Chris Etherington, tax partner at the accountancy firm RSM, said: “Tax cuts may yet be announced in the spring budget, but it seems likely these will be long-term promises that are unlikely to provide any immediate relief for taxpayers.”

The Energy Price Guarantee (EPG) currently limits average annual household bills to £2,500 – rising to £3,000 on 1^st April 2023. This increase will put additional pressure on households and individuals who are already struggling amidst the cost of living crisis and are also being squeezed by high inflation. More than 85 charities and organisations have asked the government to postpone next month’s EPG hike. If the rise is delayed, the EPG will remain at £2,500 until at least July.

Last spring, the chancellor at the time Rishi Sunak, announced a 5p cut per litre to fuel duty which is due to finish at the end of March 2023. There is speculation that Jeremy Hunt could extend the fuel duty for another year. This a welcome move for drivers currently dealing with high pump prices.

The Confederation of British Industry (CBI) is lobbying the chancellor to announce changes to childcare and early years support through extra funding in the Spring Budget 2023. The changes include extending free childcare to one and two-year-olds to help more parents to work and minimise the workforce shortages. Some MPs have also called for Jeremy Hunt to reduce the cost of nurseries and make it easier for parents to apply for tax-free childcare.

There are reports that the state pension age is under review, and changes could be announced in the Spring Budget. The age at which you can claim your state pension is 66 for men and women. It’s due to gradually increase to 67 by 2028 before rising to 68 between 2044 and 2046. The review could recommend that the state pension age increase to 68 be moved to the mid-2030s. The government has committed to publishing a review of the state pension age by May. The chancellor is also expected to raise the annual and lifetime pension allowances to encourage professionals to stay in work longer.

The FCSA has released a Budget Wish List

The FCSA has tweeted a Budget Wish List with the following changes that they would like to see announced in tomorrow’s Spring Budget 2023:

1. Index-linking of tax thresholds: FCSA would like to see tax thresholds linked to inflation to prevent people from being pushed into higher tax brackets due to inflation.
2. Steady national insurance rates: FCSA would like to see national insurance rates remain steady to provide stability for businesses and freelancers.
3. Lower dividend tax rates: FCSA would like to see a reduction in dividend tax rates to encourage investment in UK businesses.
4. Maintain the national minimum wage: FSCA would like to see the national minimum wage maintained at current levels to support low-paid workers.
5. Maintain the apprenticeship levy: FCSA would like to see the apprenticeship levy maintained at current levels to support the development of skills in the workforce.
6. Reduce overall tax burden on businesses: FCSA would like to see a reduction in the overall tax burden on businesses to encourage growth and job creation.
7. Simplify the tax system: FCSA would like to see the tax system simplified to reduce the administrative burden businesses and freelancers.
8. Increase funding for training and development: FCSA would like to see increased funding for training and development to support the upskilling of the workforce.
9. Increase investment in infrastructure: FCSA would like to see increased investment in infrastructure to support the growth of the economy.
10. Increase support for innovation and R&D: FCSA would like to see increased support for innovation and research and development to encourage the development of new technologies and industries.

Keep an eye on our blog for the latest Spring Budget 2023 announcements

Keep an eye on our blog tomorrow as we will publish the key announcements made by Jeremy Hunt as part of the Spring Budget 2023.

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