Chancellor Rishi Sunak delivers Spring Statement

Today, 23rd March 2022, Chancellor of the Exchequer Rishi Sunak made his Spring Statement.

Against a backdrop of the ongoing conflict between Ukraine and Russia and the rising cost of living – including prices increasing on fuel and food, with a 3o-year record increase in inflation for February 2022 (6.2%), the Chancellor announced the following:

Fuel cost crisis measures

Fuel duty will be cut by 5p per litre from 6pm tonight until March 2023.

Green Tax Cut: For the next 5 years, homeowners can install energy saving materials at 0% VAT – such as solar panels or heat pumps.

Doubling the Household Support Fund to £1 billion. Local Authorities will be given this funding to support those in need in their local areas.

Taxes and National Insurance

From July, people will be able to earn £12,570 a year without paying any income tax or National Insurance. 

Basic rate of income tax will be cut from 20% to 19% in 2024

Help for small businesses

From mid April, the Employment Allowance will increase from £4,000 to £5,000

Discounts for  retail, hospitality and leisure businesses – 50% discount on business rates bill up to £110,000, taking effect from next week, 1st April 2022

Reform on R&D Tax credits from April 2023 – data, cloud computing, pure maths, with more information to be announced in the Autumn Budget

Exemption on business rates for green technology. A 100% relief for eligible low-carbon heat networks which have their own rates bill will also be available

Plans to encourage greater business investment once the super-deduction ends in 2023

See all the details here in the Spring Statement documents on gov.uk

“As the economic outlook is likely to get worse before it gets better, many firms will be forced to continue raising prices, further fuelling the cost-of-living crisis.

“We urge the government to take further action – including the introduction of an SME energy price cap – to tackle the escalating cost of doing business crisis. Firms need the headroom to keep a lid on prices, protect jobs and make investment that is so vital to sustaining our economic prospects.”

On the Chancellor’s priorities for the Autumn Budget, Director General Haviland said:

“Businesses will welcome the Chancellor’s firm commitment to cut taxes on business investment, something chamber business communities have long called for. Turbocharging investment is crucial to boosting productivity, levelling-up and the transition to net zero.

“We look forward to working closely with ministers on driving stronger business investment and reform to the apprenticeship levy and R&D tax credits.”