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Monday, April 22, 2024

Chancellor unveils controversial budget plans.

Political leaders give their reactions to Budget 2024

Speaking in Parliament today, Chancellor Jeremy Hunt put forward his budget plan. Key points are tax cuts for workers and families, duty on fuel and alcohol frozen, and relief for small businesses.

He also put forward rises in taxes on vapes and tobacco, oil and gas windfall tax extended, and abolishing the non – dom tax system. This is where individuals who live in the UK but claim tax on their permanent place of residence abroad. This means they do not have to pay UK tax rates on their foreign income.

According to research from the London School of Economics, in collaboration with the University of Warwick, eliminating the non – dom status alone could “raise approximately £3.6 billion annually. This potential revenue could be used to fund other tax reforms.”

A major change was also the cutting of National Insurance by 2p, which means it falls from 10% to 8%. This drop means the average worker will save about £450 a year.

Key points in the budget were:

  • A reduction in National Insurance by 2p
  • Plans to get rid of the “non- dom” tax system
  • A freeze in alcohol duty
  • A six-month extension to the Household Support fund
  • An extension to the 5p cut in fuel duty.
  • Moving the child benefit threshold from £50,000 to £60,000
  • An increase in the VAT threshold for small businesses to £90,000

The budget seems clearly aimed at boosting the economy, especially the struggling hospitality and tourism sectors, and benefitting working people – which in his speech Mr Hunt termed, “making work pay”.

The Chancellor also shared his view that the most successful economies tend to have lower taxes, and that he was determined to bring down both taxes and borrowing.

However, the budget announcement has met with strong reactions from all sides in the political landscape of the UK.

The Green Party’s Carla Denyer says people can see through the pre-election tax bribes

Speaking in an interview with The Asian Standard, Carla Denyer co – leader of the Green Party gave us her reaction: “I think people can see the pre – election tax bribes from the Conservative government in this budget. Polling has shown that the majority of British people don’t support cuts if it means cuts to essential services, which this budget will mean. What we needed to see was a plan to tax wealth fairly. We’ve calculated that the government could have raised over 15 billion pounds a year that would have provided the vital public investment that the public is crying out for.

We are also worried that the possible incoming Labour Government are unnecessary locking themselves into the conservative straightjacket of not being willing to make changes to the tax system that would make the economy fairer for everyone.”

Lib Dem leader Sir Ed Davey called out the budget as bottom of the barrel

The Liberal Democrat leader, Ed Davey responded: “This is a bottom of the barrel Budget from a Conservative government that has given up on governing. Rishi’s recession is being followed by Hunt’s hangover, with years of unfair tax hikes while local health services are stretched to breaking point.

This Budget has nothing to offer for people seeing their mortgage soar due to Conservative chaos or being left waiting for months in pain for NHS treatment.”

The Mayor of London, Sadiq Khan stated: “Due to the Government’s mismanagement of our economy, Londoners continue to face a perfect storm of low growth, cost of living pressures, soaring housing costs, and cuts to key public services. Tax cuts announced today go nowhere near making up for the huge hikes in mortgage payments and rents Londoners have faced.

The Metropolitan Police continues to be chronically underfunded by Government despite the unprecedented pressure on it’s resources.”

Mr Khan goes on to outline his view that the Chancellor does not understand the needs of ordinary Londoners:

“Today’s budget demonstrates that ministers don’t understand the pressures Londoners are under, and they continue to starve London of the investment we need that would bring benefits to the whole country.”

Labour leader Keir Starmer says the government’s budget is the ‘last desperate act of a party that has failed.’

Labour Leader Kier Starmer called it, “The last desperate act of a party that has failed.” He went on to give his view of how the economy has been in recent times: “Food prices – still 25% higher than they were two years ago. Rents up 10%. An extra £240 a month for a typical family remortgaging this year.

Because they lost control of the economy. They sent interest rates through the roof.”

Mr Starmer also described the Tory policy as “Give with one hand, take even more with another.”

Commenting on what the tax cuts will mean for everyday people, “They know the thresholds are still frozen, dragging more and more people into higher taxes.

They know that a Tory stealth tax is coming their way in the shape of their new council tax bill.”

Mr Starmer ended with the view:“Give our public services an immediate cash injection. Stick to fiscal rules without complaint. Fight for the living standards of working people. And deliver a sustainable plan for growth.”

Many political leaders are now calling for an election, and giving their view that the Conservative tax cuts are simply a way of bribing the general public. With debate raging, and dynamic policies being put into action, it remains to be seen whether this budget can help the Tories stay in power.


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