What can we expect from the Spring Budget 2023?
On 15th March, the Chancellor, Jeremy Hunt, will present his Spring Budget in the House of Commons, in what is set to be a highly anticipated announcement.
Following a tumultuous Autumn Budget in November of last year that took place after significant backlash from the September 2022 Mini Budget, not to mention the ongoing cost of living crisis, rumours are swirling as to what may be announced.
So, what could we potentially see from this year’s Spring Budget? We take a look below…
Fuel duty cut
2022 saw fuel prices increase significantly, which led to fuel duty on petrol and diesel cars being cut by 5p a litre. Although this was set to end in March 2023, it is predicted that the Chancellor will extend this for a further 12 months.
Experts are predicting that the possibility of the Chancellor announcing tax cuts is highly unlikely as several tax-cutting promises from last year’s Autumn Statement are already due to come into force in April, including the extended freeze on personal allowance and income tax thresholds. Despite this however, there are also rumours that Hunt could lay out plans to make future tax cuts, Theresa Villiers, former cabinet minister, has said:
“Everyone recognises that there are limits to what [Hunt] can do on tax at the moment, because of the huge costs of the pandemic and the impacts of the war in Ukraine. I think we would all like to see the Chancellor show there is a path to lowering taxes in the future.”
Energy price cap
Hitting the headlines for the majority of last year and indeed into 2023, energy prices have been a huge topic of discussion both for individuals and businesses alike. Experts believe that the Chancellor will not change his plans, announced in the Autumn Statement 2023, to run the Energy Price Guarantee (EPG) for a further 12 months from April 2023, however the price cap will increase from £2,500 to £3,000.
Any further announcements regarding support with the cost of living crisis seem unlikely, with the Chancellor himself stating that there was little ‘headroom to make a major new initiative to help people’.
What is the business world looking out for in 2023’s Spring Budget?
In a letter to the Treasury, the Confederation of British Industry (CBI) has asked the government to commit to a number of actions, aimed at ensuring any recession that the UK economy is short-lived. Just some of the actions outlined include:
- Taking action to tackle labour and skills shortages. This includes childcare reform, increasing the health support available to employees and Apprenticeship Levy reforms; all of which will aim to keep or encourage people to return to the labour market, as well as upskill in their career.
- Drive productivity growth by encouraging business investment through the tax system. This could potentially include replacing the super-deduction with full expensing for capital investment, or at least a roadmap towards achieving this.
- Support for companies and organisation to operate more energy efficiently in preparation for next winter.
Keep your eyes peeled for our full Spring Budget 2023 overview once announced on 15th March.
If you have any questions about how your business could be operating more tax efficiently in the 2023/24 financial year, speak to our team of expert accountants today!