Spring Budget 2023
What you need to know
What is the Spring Budget and what does it mean for you? The Spring Budget is typically announced by the UK Government in March each year and includes updates on tax, national insurance, and other economic policies.
Detailed Articles on the topic
We have produced a number of detailed articles relating to how the 2023 spring budget affects individuals differently. If you would like to find out how the spring budget may affect you more directly view one of the articles below:
Background - the energy crisis
According to research by the International Monetary Fund, the energy problem is having a greater impact on household budgets in the UK than in any other nation in western Europe.The UK heavily relies on gas to heat homes and generate electricity at a time when gas costs are skyrocketing due to Russia's conflict in Ukraine. Furthermore, the houses in the UK are the least energy efficient in all of western Europe. As retailers pass on the price increases, rising energy expenses also raise the cost of other goods. Indirect impacts like these will reduce household spending in the UK by an additional 2% in 2022. The IMF analysis considers how people may use less energy as prices increase.
Energy Costs
Energy costs have fallen significantly: In 2023, the average wholesale price is now predicted to be £1.50, which is less than half of the £3.40 assumed in November.
Childcare
Including the extension of the 30 hours per week of free childcare presently offered to many families with 3 and 4 year olds to younger children.
Work Coach’s support
More long-term ill and disabled individuals will receive a work coach's support. Work coaches provide individuals with guidance, coaching, and support to help them find employment.
Capital Allowance
Beginning in April and continuing for the following three years, businesses will be able to deduct 100% of all plant and machinery investment costs when determining taxable profits.
Alcohol duty reform
Alcohol duty rates and Alcohol duty reform - Drought Relief will reduce the tax burden on alcoholic drinks sold on tap – but alcohol duties will still rise with inflation. This can have both positive and negative impacts on various stakeholders.
These changes are used to increase the financial revenue that the government to be used to pay for infrastructure and public services. However, because the government may spend a larger percentage of their money on alcohol, low-income households may be disproportionately affected by rising alcohol duty rates. Additionally, it can result in an increase in cross-border shopping and the smuggling of alcohol, especially if one country has much greater duty rates than its neighbors. The government may receive less money as a consequence, and there may also be an increase in crime and its risks.
Need more help?
If you need more help regarding the recent changes do not hesitate to contact us. We have over 15 years of experience helping our clients save on their tax liability.
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