Spring Budget 2024: Impact & Analysis | Key Dates & Predictions

The publication date for the Spring Budget 2024 has been announced by the Chancellor of the Exchequer, Jeremy Hunt, as 6 March. Less than a week! The Office for Budget Responsibility is also authorised to produce an economic and fiscal forecast for Parliament alongside the Spring Budget. It is usually released around 12.30 pm and can be watched on the BBC Parliament. The Scottish Government published a letter to the UK government about the Spring Budget 2024, which includes energy bills, Universal Credit, cost of living, and many more.

With the statement due to be published next week, we need to understand what it means to understand better and make sense of it.

What is the Spring Budget?

The Spring Budget, or Spring Statement, is one of the two financial statements (the second is the Autumn Statement) the UK Parliament publishes yearly that shows the economy's overall health and the government's short-term and long-term forecasts. It also includes further economic plans for 2024 and beyond. This practice was created by the Industry Act 1975. Some parts of the statement affect the whole UK, while others, such as education, only affect England since Scotland, Wales, and Northern Ireland make their own decisions.

At the World Economic Forum in Davos, Hunt hinted that cutting taxes could be in the Budget to make the economy grow again. But he also said there may be more money to make significant changes. We know the importance of this year's Budget since it is expected to be the last fiscal event before the autumn general election, as Prime Minister Rishi Sunak said the general election could be helpful in the second half of the year.

How does the Spring Budget affect me?

Generally, these fiscal plans focus on taxation and spending. Last year, the availability of free childcare was increased, and the lifetime pension allowance was stopped. Since it includes changes and forecasts, it could affect your way of life. Some topics are expected to be included in the Budget:

Cutting the tax rates (income or national insurance).

“The public is increasingly feeling the tax burden as a result of high inflation, tightening income and fiscal drag which has pulled many into the income tax system for the first time or into higher tax bands. (…) The Chancellor has a difficult balancing act; appeal to voters through tax cuts and increased incentives, while keeping the books as balanced as he can.”

Christine Cairns, Tax Partner at PwC UK - PwC Spring Budget 2024 Preview

Simplifying the Individual Savings Accounts (ISAs).

Increasing the £50,000 threshold on child benefits to support childcare costs.

“The government announced an extension to free childcare in the Spring Budget in 2023. However, the £50,000 threshold for child benefit has been static since 2013 and is arguably long-overdue a reset. An increase to the threshold for the High Income Child Benefit Charge would chime with the government’s ongoing initiative of getting people back to work.”

Tim Sarson, Value Chain Management Partner and UK Head of Tax Policy - KPMG Spring Budget 2024 Predictions

A reform in the inheritance tax.

Introducing 99% mortgages to help buy a home.

“The Chancellor could look to increase the flexibility of the LISA regime by increasing the price of the property purchased by a first-time buyer from the current £450,000 to £500,000, or potentially higher, given the movement of house prices since the LISA was introduced.”

Tom Evennett, EY UK&I Private Client Services Leader - EY’s Spring Budget 2024 Predictions

The last three budgets had energy tax increases, but nothing is guaranteed related to fuel duty after energy prices fell significantly in recent months.

It is not just another government announcement

The yearly published Budget has, directly and indirectly, impacted your life and economic well-being as it shows the government's plan. Check out the outcomes even if you don't watch the entire announcement. One decision in the Budget could affect your life. So, when the Spring Budget is published, pay attention…