Bees

What does the Spring Statement mean for you?

23.08.2021

By Beehive Money

Spring Budget
Beehive's aim is to help our members get to grips with savings and the financial landscape as best they can - we understand that it can be overwhelming sometimes. Twice a year, the chancellor of the exchequer, at the moment this is Rishi Sunak, makes a statement to MPs in the House of Commons on the position of the government’s finances. The main announcement is the Budget in the autumn, the Spring Statement provides an update on the progress since then. To have a look at the Spring Statement as a whole, check out the BBC News or GOV.uk websites.

Taxes and duties

  • There will be a 5p cut to fuel duty - "the biggest cut to all fuel duty rates ever". He announced the cut will come into force at 18:00 tonight, the 23rd March 2022, and last until March next year. According to the BBC, motoring group the RAC says cutting fuel duty by 5p will take £3.30 off the cost of filling a typical 55-litre family car.

Homes 

  • There will be 0% VAT on energy saving materials, such as solar panels or heat pumps for homeowners for the next five years - a little helping hand if you're looking to make your home more eco-friendly by installing solar panels and the like. 
  • The government's household support which is the money they supply councils with to support vulnerable households, will be doubled to £1bn from April. 

Pay and wages

  • The government will raise the threshold for the amount people earn before they pay National Insurance by £3,000 from July. Rishi Sunak stated "from this July, people will be able to earn £12,570 a year without paying a single penny of income tax or National Insurance." This would mean a £6bn personal tax cut for 30 million people in the UK and a tax cut for employees worth over £330 a year. This will be "the largest increase in a basic rate threshold ever, and the largest single personal tax cut in a decade."
  • Before the end of this Parliament in 2024, the basic rate of income tax will be cut from 20p to 19p in the pound but this hasn't been given a definitive date.

Education and training

  • Employment training in the private sector will be reviewed as part of the government's new tax plan which will include assessing whether the apprenticeship levy – a tax on the wage bills of major companies introduced in 2017 to pay for skills training - is "doing enough".