Source: Intelligent Instructor
Chancellor freezes fuel duty for a further 12 months
Another spring and another government Budget.
After last year’s shenanigans, the hope was for some announcements that would be a little less controversial than last autumn’s version of events.
The Chancellor of the Exchequer, Jeremy Hunt, delivered a calmer affair.
He has frozen Fuel duty, boosted repairs to pothole damaged roads and targeted solutions to recruitment issues in his Budget statement.
Key for our industry is the extended freeze on fuel tax and extend the existing 5p per litre cut. This will continue for a period of 12 months in a bid to ease the cost of motoring.
Holes in the finances
Another key area of concern for those of us out on the road everyday is the dangerous state of disrepair. Not only is this a road safety issue, it can also prove very expensive in car repairs, from wheel balancing and puncture repairs, right through to suspension and steering damage.
Hunt promised a further £200 million to fund pothole repairs across the UK. It is part of city region sustainable transport settlements, which will see allocating £8.8bn over next five years. That figure is to cover a whole host of public transport interests, while pothole and general carriageway repairs and a very minor part. Ensuring direct funding for the pothole issue is essential.
Away from the roads the Chancellor made changes that would attempt to boost an economy bordering on recession. After the confidence of the money markets was tested by Hunt’s predecessor, thought to cost the country in the region of £50bn, stability is key.
Addressing MPs in the House of Commons, Hunt said that the Office for Budget Responsibility (OBR) now forecast a 0.2% decline in the economy this year, with the rate of inflation forecast to fall to from 10.7% in Q4 2022 to 2.9% by the end of 2023.
The UK economy is forecast to grow by 1.8% in 2024; 2.5% in 2025; 2.1% in 2026; and 1.9% in 2027.
Revealing his Budget, Hunt said: “Today we build for the future with inflation down, debt falling and growth up. The declinists are wrong, and the optimists are right.
“We stick to the plan because the plan is working.”
In his Budget Hunt confirmed that the Energy Price Guarantee will remain at £2,500 for the typical household for the next three months in a move estimated to save the average family £160.
Businesses will still see corporation tax increase from 19% to 25% with all firms which make a profit of more than £250,000 paying 25% tax on their profits from April.
However, small businesses will see their Annual Investment Allowance to £1m. It means that 99% of all businesses can deduct the full value of all their investment from that year’s taxable profits.
Hunt says that the move meant that every single pound a company invests in IT equipment, plant or machinery can be deducted in full and immediately from taxable profits.
Elsewhere, Hunt revealed plans to encourage older people to continue working for longer to ease the UK’s recruitment challenges.
An apprenticeship-style “Returnship” will aim to re-train over-50s to return them to the workplace.
Government will also increase the pensions annual tax-free allowance from £40,000 to £60,000 and will abolish the Lifetime Allowance – previously set at £1.07m – in a bid to discourage early retirement. Of course you would have to be a very successful driving instructor indeed to benefit from this.
There were also announcements on child care to help new parents get free places for their children, allowing them to return to work sooner. Alongside this, there will be changes to the amount of money you can earn without losing any benefits.
“As part of its bid to reduce the UK’s carbon emissions and boost the sustainability of its energy sector, the Chancellor committed £20bn of support for the early development of carbon, capture, usage and storage.
Government will also extend its Climate Change Agreement scheme for two years to allow eligible businesses £60m of tax relief on energy efficiency measures.
Nuclear power, meanwhile, will be reclassed as ‘environmentally sustainable’ to give the sector access to the same investment incentives as renewable energy.