Jeremy Hunt says the government has taken difficult decisions to put the economy back on track and halve inflation, but “the work is not done”.
The main rate of Employees Class 2 National Insurance will be cut from 12% to 10% from 6 January 2024.
The rate of Class 4 NICs for the Self-Employed on all earnings between £12,570 and £50,270 will be cut from 9% to 8% from April 2024.
Class 2 National Insurance payable by the Self-Employed will be scrapped completely.
The temporary Full Expensing Allowance will be made a permanent option for companies to offset 100% of the cost of items such as equipment and machinery.
A business rates support package worth £4.3 billion over the next 5 years will help high streets and small businesses. This includes a rollover of 75% Retail, Hospitality and Leisure relief.
The existing R&D Expenditure Credit and Small and Medium Enterprise Scheme will be merged in April 2024, simplifying the system and boosting innovation in the UK.
The rate at which loss-making companies are taxed within the merged scheme will be reduced from 25% to 19%, and the threshold for additional support for R&D-intensive loss-making SMEs will be lowered to 30%.
The National Living Wage will increase from April 2024 to £11.44. It will also be extended to 21-year-olds.
There will also be increases to the National Minimum Wages for 18–20-year-olds to £8.60 and 16–17-year-olds, including apprentices, to £6.40.
Reform will be taking place to the Work Capability Assessment to ensure that people who can work are supported to do so via the welfare system. Changes to the activities and descriptors will better reflect the greater flexibility and reasonable adjustments now available in the world of work, preventing some individuals from being deemed not fit for work and ensuring they will be better supported into employment.
Mandatory work placements will boost skills and employability for those who have not found a job after 18 months of intensive support. Those who choose not to engage with the work search process for six months will have their claims closed and benefits stopped.
The State Pension will be increased by 8.5% in April 2024, and Universal Credit and other working-age benefits will also be boosted by 6.7% in April 2024.
The Local Housing Allowance will also increase, in a measure worth £800 for some households next year.
There will be an extra investment of £4.5bn between 2025 and 2030 in manufacturing, with £1m going to aerospace companies and businesses working on green technologies.
There will be a new investment zone in Wrexham, Wales, in a bid to increase employment in the area. There will be three others: Manchester, the West Midlands and the East Midlands.
Inflation is expected to fall to 2.8% by the end of 2024, down from 11.1% last year.
It expects the central bank’s key interest rate to stick at about 4% until 2028 rather than drop to 3%, as is predicted in the spring.
For more details on the Autumn Statement, visit the gov website:
https://www.gov.uk/government/publications/autumn-statement-2023
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