On 23rd March the Chancellor of the Exchequer has delivered his Spring Statement to Parliament.
The Government has published a Spring Statement Tax Plan, which brings together proposals to reduce and reform taxes over the Parliament as follows:
- Employment Allowance will increase from £4,000 to £5,000 from April 2022;
- Basic rate of income tax will reduce from 20% to 19% from April 2024;
- National Insurance Primary Threshold and the Lower Profits Limit increase and associated Class 2 changes will increase from £9,880 to £12,570 from July 2022;
- Duty on petrol and diesel will be cut by 5p per litre for 12 months. This will take effect on 23 March;
- VAT relief for energy saving materials (ESMs) and introduction of time limited zero rate for the installation of ESM will be introduced from April 2022.
- Relief for capital investment giving tax relief for future business investment will be introduced after the super-deduction ends in April 2023.
- R&D tax relief reform will include cloud and data cost from April 2023. Some overseas cost will also classify.
- The Chancellor’s Tax Plan brought together some of the announcements under the themes of helping families with the cost of living, creating the conditions for private sector led growth (focusing on capital, people and ideas) and sharing the proceeds of growth (ie the proposed income tax reduction).
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