Budget 2023 - at a glance

The Chancellor Jeremy Hunt has delivered his Budget in the Commons saying he was reporting today on a "British economy that is proving the doubters wrong".

The Chancellor said that his budget will achieve growth by removing obstacles that stop businesses investing; by tackling labour shortages that stop them recruiting; by breaking down barriers that stop people working; and by harnessing British ingenuity to make us a science and technology superpower

Ahead of the Chancellor's Budget speech, the government announced it will extend the Energy Price Guarantee (EPG) at its current level of £2,500 for a further three months until the end of June. However, the £400 winter fuel payment will not be renewed.

April will see corporation tax rise from its current level of 19% to 25%, netting £18 billion per year for the Treasury. Debate has been sparked amongst business leaders as to the government's commitment to ease cost pressures on UK businesses, and the planned rise in corporation tax has only added fuel to the fire. Critics of the rise argue that cutting corporation tax helps to stimulate growth and investment.

The key points are:

Tax & Wages

• Cap on amount workers can accumulate in pensions savings over their lifetime before having to pay extra tax (currently £1.07m) to be abolished
• Tax-free yearly allowance for pension pot to rise from £40,000 to £60,000 - having been frozen for nine years
• Fuel duty frozen - the 5p cut to fuel duty on petrol and diesel, due to end in April, kept for another year
• Alcohol taxes to rise in line with inflation from August, with new reliefs for beer, cider and wine sold in pubs
• Tax on tobacco to increase by 2% above inflation, and 6% above inflation for hand-rolling tobacco

Energy

• Government subsidies limiting typical household energy bills to £2,500 a year extended for three months, until the end of June
• £200m to bring energy charges for prepayment meters into line with prices for customers paying by direct debit - affects 4m households
• Commitment to invest £20bn over next two decades on low-carbon energy projects, with a focus on carbon capture and storage
• Nuclear energy to be classed as environmentally sustainable for investment purposes, with promise of more public funding
• £63m to help leisure centres with rising swimming pool heating costs, and invest to become more energy efficient

Jobs & Work

• 30 hours of free childcare for working parents in England expanded to cover one and two-year-olds, in a bid to help them work more
• Families on universal credit to receive childcare support up front instead of in arrears, with the £646-a-month per child cap raised to £951
• £600 "incentive payments" for those becoming childminders, and relaxed rules in England to let childminders look after more children
• New fitness-to-work testing regime to qualify for health-related benefits
• Funding for up to 50,000 places on new voluntary employment scheme for disabled people, called Universal Support
• Tougher requirements to look for work and increased job support for lead child carers on universal credit
• More places on "skills boot camps" to encourage over-50s who have left their jobs to return to the workplace

Business & Trade

• Main rate of corporation tax, paid by businesses on taxable profits over £250,000, confirmed to increase from 19% to 25%
• Companies with profits between £50,000 and £250,000 to pay between 19% and 25%
• Companies able to deduct investment in new machinery and technology to lower their taxable profits
• Tax breaks and other benefits for 12 new Investment Zones across the UK, funded by £80m each over the next five years
• Reduced paperwork for international traders, who will also be given longer to submit customs forms under streamlined rules

Other Measures

• Commitment to raise defence spending by £11bn over the next five years
• Prison sentences for those convicted of marketing tax avoidance schemes
• An extra £20m over next two years for charities helping to prevent suicide
• Streamlined approvals process promised for new medical products
• £900m for new super computer facility, to help UK's AI industry

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