Autumn Statement: What will the chancellor announce on Thursday?

Chancellor Jeremy Hunt Credit: PA

Here is my list of tax rises, spending cuts and benefit changes that I expect to be in Jeremy Hunt’s Autumn Statement on Thursday. The moves are intended by the chancellor to fill most of a £55bn hole in the public finances. 

1) Universal Credit and benefits are set to rise by the 10.1% inflation rate, along with the state pension.

2) The national living wage for 2023 will rise to an estimated £10.40, up from £9.50 - and the target of this minimum wage rising to two-thirds of median or typical earnings in 2024 will be reconfirmed. 

3) The earnings threshold at which the 45% rate of tax kicks in will be cut from £150k to £125k - bringing hundreds of thousands of earners into that top tax bracket.

ITV News Political Editor Robert Peston on the significant changes to tax and spending we can expect from Jeremy Hunt on Thursday

4) All other income tax and national insurance thresholds are to be frozen for another three years from 2025.

5) VAT and inheritance tax thresholds are also to be frozen for another three years.

6) The pensions lifetime allowance is to be frozen for a further three years too.

7) The capital gains tax threshold is to be halved. 

8) This freeze of income tax, NI, VAT and inheritance tax thresholds would raise circa £10bn a year, as “hidden tax rises”. 

9) For the next two years, all departments will be obliged to stick to existing spending totals, with no extra cash to help with inflation. This will be painful, as public sector pay claims and energy costs are far outstripping increases in cash budgets set in the last spending review.

10) Public spending in the round will be projected to rise by a meagre 1% a year for three years from 2025, to yield estimated annual savings of £25bn. 

11) The oil and gas windfall tax will be lengthened in duration by two years and its rate will be increased by 10%. Also a planned cut in the levy on banks’ profits will be abandoned.

The net effect of all these tax and spending changes, along with inflation, will leave everyone worse off, though there will be some protection for those on lowest incomes. 

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