Newspaper Column 12th March 2024 - The Spring Budget

The news last week was dominated by the Chancellor’s Spring Budget Statement, which saw a number of positive announcements which I am sure will be welcomed by people across Truro and Falmouth.

The last few years have not been easy for the British economy. We have faced the legacy of Covid, war in Ukraine and the Middle East. These challenges have made life tough for people in Britain.

Since the beginning of 2023, we have been working on five priorities. Three of them are economic. To halve inflation, grow the economy and reduce debt.

We have made good progress. Inflation has fallen from 11.1 per cent to 4.0 per cent, the economy has performed better than forecast, wages are rising, mortgage rates are starting to come down, the economy has outperformed European neighbours and debt is on track to fall as a share of the economy.

The job is not done. But because of the progress we have made, the economy is turning a corner and we have been able to afford tax cuts as part of our plan to reward work and grow the economy.

Last week’s Budget shows the plan is working. The Budget will:

·       Cut taxes for 27 million working people from April, by again cutting the main rate of employee National Insurance Contributions (NICs) from ten per cent to eight per cent. Combined with the cut at the Autumn Statement, that is a tax cut of over £900 for the average worker earning £35,400 – giving the average earner the lowest effective personal tax rate since 1975.

·       Cut taxes for two million of the self-employed, by cutting the main rate of Class 4 NICs from nine per cent to six per cent. Combined with the tax cuts for the self-employed at the Autumn Statement, this is a tax cut of around £650 for an average self-employed person earning £28,000 a year.

·       Support half a million families through changes to the High Income Child Benefit Charge by raising the threshold and halving the rate at which Child Benefit is withdrawn, benefiting some parents by an average of £1,260. By April 2026 we will also end the unfairness for single earner families.

·       Reduce debt, with overall debt beginning to fall next year and the Office for Budget Responsibility (OBR) forecasting we will meet our fiscal rule to have debt falling as a share of the economy.

·       Freeze alcohol duty, alleviating pressure on the hospitality sector.

·       Maintain the five pence cut to fuel duty and freeze rates for the fourteenth consecutive year, helping keep motoring costs down – a £3.1 billion tax cut for drivers.

·       Cut Capital Gains Tax on residential property sales, encouraging those who want to sell their second homes and buy to lets to make more houses available for families.

·       Increase the VAT registration threshold for small businesses for the first time since 2017, raising it from £85,000 to £90,000.

·       Support and reform the NHS with £2.45 billion for next year and a new £3.4 billion productivity plan, saving money, freeing up clinicians’ time to focus on patients, and cut wait times.

·       Introduce a new duty on vapes, protecting young people and children from the harm of vaping.

·       Reform our tax system – ensuring those with the broadest shoulders contribute a bit more.

Away from the big picture announcements, I was delighted to see the Chancellor recognise my own work in pushing for more controls on holiday lets when he name-checked my work in campaigning to remove the unfair rules which incentivised landlords to make their properties holiday lets rather instead of renting them to local people all year round. This is a fair and sensible step to take and I hope will make landlords consider switching their properties to permanent residential homes for local people, helping ease the housing pressures that we see in Cornwall.

All in all, last week’s Budget was a sensible and pragmatic one.

The choice is clear – stick with the plan that is working under Rishi Sunak and the Conservatives which will deliver a brighter future for the country or go back to square one with Keir Starmer and Labour, who can’t say what they’d do, because they don’t have a plan.

As always, I am fully focused on the job at hand and if there is ever anything at all I

can do to help, then please do not hesitate to contact me. Please get in touch with

me by email at Cherilyn.mackrory.mp@parliament.uk, or by telephone on 01872

229698. My regular constituency advice surgeries are held in a covid-safe

environment at my office, so please do get in touch should you wish to meet me

about any matters that I can be of assistance with.