Home news Summary of Budget 2017: Key points at-a-glance

Summary of Budget 2017: Key points at-a-glance

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Philip Hammond has delivered his second Budget as chancellor. Here are the key points of his speech.

Stamp duty and housingStamp duty to be abolished immediately for first-time buyers purchasing properties worth up to £300,000
To help those in London and other expensive areas, the first £300,000 of the cost of a £500,000 purchase by all first-time buyers will be exempt from stamp duty, with the remaining £200,000 incurring 5%.
95% of all first-time buyers will benefit, with 80% not paying stamp duty
Reduction will apply immediately in England, Wales and Northern Ireland although the Welsh government will have to decide whether to continue it when stamp duty is devolved in April 2018
It will not apply in Scotland unless Scottish government decides to follow suit
£44bn in overall government support for housing to meet target of building 300,000 new homes a year by the middle of the next decade
Councils given powers to charge 100% council tax premium on empty properties
Compulsory purchase of land banked by developers for financial reasons
£400m to regenerate housing estates and £1.1bn to unlock strategic sites for development
Review into delays in developments given planning permission being taken forward
£28m for Kensington and Chelsea council to provide counselling services and mental health support for victims of the Grenfell fire and for regeneration of surrounding area
New homelessness task force
Stamp duty cut for first time buyers
What does the stamp duty change mean?

Alcohol, tobacco and fuelTobacco will continue to rise by 2% above Retail Price Index (RPI) inflation, equivalent to 28p on a pack of 20, while the minimum excise duty on cigarettes introduced in March will also rise
Duty on hand-rolling tobacco will increase by additional 1%
Duty on beer, wine, spirits and most ciders will be frozen, equating to 12p off a pint of beer and £1.15 off a bottle of whisky by next April
But duty on high-strength “white ciders” to be increased in 2019 via new legislation
Fuel duty rise for petrol and diesel cars scheduled for April 2018 scrapped
Vehicle excise duty for new diesel cars not meeting latest standards to rise by one band in April 2018
Tax hike will not apply to van owners
Existing diesel supplement in company car tax to rise by 1%
Proceeds to fund a new £220m clean air fund
What the Budget 2017 means for you

Personal taxation and wagesTax-free personal allowance on income tax to rise to £11,850 in April 2018
Higher-rate tax threshold to increase to £46,350
Short-haul air passenger duty rates and long-haul economy rates to be frozen, paid for by an increase on premium-class tickets and on private jets
National Living Wage to rise in April 2018 by 4.4%, from £7.50 an hour to £7.83.

The state of the economy

Growth forecast for 2017 downgraded from 2% to 1.5%
GDP downgraded to 1.4%, 1.3% and 1.5% in subsequent years before rising to 1.6% in 2021-22
Productivity growth and business investment also revised down
Annual rate of CPI inflation forecast to fall from peak of 3% towards 2% target later this year
Another 600,000 people forecast to be in work by 2022
£3bn to be set aside over next two years to prepare UK for every possible outcome as UK leaves EU
Sharp cut to UK growth forecast

The state of the public financesAnnual borrowing £49.9bn this year, £8.4bn lower than forecast in March
Borrowing forecast to fall in every subsequent year from £39.5bn in 2018-19 to £25.6bn in 2022-23
Public sector net borrowing forecast to fall from 3.8% of GDP last year to 2.4% this year, then 1.9%, 1.6%, 1.5% and 1.3% in subsequent years, reaching 1.1% in 2022-23.
Debt will peak at 86.5% of GDP this year, then fall to 86.4% next year; then 86.1%, 83.1% and 79.3% in subsequent years, reaching 79.1% in 2022-23.

Welfare and pensions£1.5bn package to “address concerns” about the delivery of universal credit
Seven-day initial waiting period for processing of claims to be scrapped
Claimants to get 100% advance payments within five days of applying from January
Typical first payment will take five weeks rather than current six
Repayment period for advances to increase from six to 12 months.
New universal credit claimants in receipt of housing benefit to continue to receive it for two weeks

Business and digital

VAT threshold for small business to remain at £85,000 for two years
£500m support for 5G mobile networks, full fibre broadband and artificial intelligence
£540m to support the growth of electric cars, including more charging points
A further £2.3bn allocated for investment in research and development
Rises in business rates to be pegged to CPI measure of inflation, not higher RPI, a cut of £2.3bn
Digital economy royalties relating to UK sales which are paid to a low-tax jurisdiction to be subject to income tax as part of tax avoidance clampdown. Expected to raise about £200m a year
Charges on single-use plastic items to be looked at
£30m to develop digital skills distance learning courses

Education and health (England only)

£40m teacher training fund for underperforming schools in England. Worth £1,000 per teacher
8,000 new computer science teachers to be recruited at cost of £84m and new National Centre for Computing to be set up
Secondary schools and sixth-form colleges to get £600 for each new pupil taking maths or further maths at A-level and core maths at an expected cost of £177m
£2.8bn in extra funding for the NHS in England
£350m immediately to address pressures this winter, £1.6bn for 2018-19 and the remainder in 2019-20
£10bn capital investment fund for hospitals up to 2022
No extra funding for nurses pay but a guarantee that if future pay rises are recommended by independent body, there will be new money
Cash for maths, no extra on school budgets
The NHS will get extra money – chancellor

Nations/infrastructure/transport/regions/science£320m to be invested in former Redcar steelworks site
Further devolution of powers to Greater Manchester
£1.7bn city region transport fund, to be shared between six regions with elected mayors and other areas
£30m to improve mobile and digital connectivity on TransPennine rail route.
£2bn for Scottish government, £1.2bn for Welsh government and £650m for Northern Ireland executive
Scottish police and fire services to get refunds on VAT from April 2018
Young person’s railcard extended to 26-30-year-olds, giving a third off rail fares

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Source: BBC