The Budget in Brief: Cuts, Reliefs, and Reforms

In a decisive move to spur economic growth, UK Chancellor Jeremy Hunt has presented a budget focused on long-term prosperity and reducing the electoral deficit faced by the Conservative government. The centerpiece of Hunt’s announcement is a strategic reduction in national insurance contributions, benefitting 27 million workers at a cost of approximately £10bn annually. This initiative is part of a broader strategy to invigorate the UK economy, which is forecasted to grow by 0.8% in 2024.

Key policy highlights include the abolition of the controversial ‘non-dom’ tax regime, expected to bring in £2.7bn yearly by taxing UK residents on their global income. Additionally, the government is raising the child benefit income threshold and offering a £5,000 boost to individual savings accounts for domestic equity investments, alongside several targeted tax rises.

The economic forecast paints a cautiously optimistic picture, with growth expected to pick up gradually, inflation to slow down, and living standards to recover to pre-pandemic levels by 2025-26. Despite these positive indicators, the tax burden on the economy is anticipated to reach its highest point since 1948, even with the announced tax cuts.

This budget reflects a comprehensive approach to addressing the UK’s economic challenges, balancing short-term relief for workers with long-term investments in growth. It’s a clear signal that the government is prioritizing economic stability and growth ahead of the upcoming general election.

Budget Breakdown: