Damian welcomes the announcements made in last week’s Autumn Statement to help people keep more of what they earn, new measures to boost incomes, and the on-going reforms to make sure work always pays.
Damian said:
“Raising the tax-free personal allowance has done more to improve the lot of working people. Currently £11,000 a year, this will rise to £11,500 in 2017-8 and to £12,500 by 2020-21. As a result of the changes made since 2010, someone with a salary of £15,000 pays just £800 a year in income tax now compared to £1,705 six years ago. And the point at which people pay the higher rate of income tax is also being raised from £43,000 this year to £45,000 in 2017-18 and targeted to be £50,000 by the end of this parliament.
“A further boost to incomes will come with the increase in the National Living Wage from £7.20 to £7.50 in April 2017 – a further pay rise for 1.3 million people, worth over £500 a year to a full-time worker.
“Universal Credit is an important reform to our benefits system designed to make sure work always pays. To reinforce that, the UC taper rate will be reduced from 65% to 63% - equivalent to a tax cut for those in work on low incomes.”
The statement also confirmed the introduction of 30 hours of free childcare for 3 and 4 year olds from September 2017 and the higher rate of reimbursement for childcare costs for low earners at 85%.
Damian added:
“Another important announcement was the continuing freeze on fuel duty in 2017, which is particularly significant for a rural area such as East Hampshire, and will save drivers £130 a year on average.”
The Autumn Statement aims to provide a stable economic platform as the UK prepares to leave the European Union and continues to address some of the long-term challenges to make Britain more productive, including some substantial infrastructure investments.
A new National Productivity Investment Fund is being set up to provide £23 billion of spending in areas such as transport, digital communication, R&D and housing. More investment is also earmarked for future transport technology, including £100 million for testing driverless cars and £80 million to install charging points for ultra-low emission cars.
Damian continued:
“I was especially pleased to see the new first year allowance being introduced to enable companies to deduct the cost of installing electric charge-points from pre-tax profits, and the extra £450 million being spent on trialling railway digital signalling technology. Any measures that can improve the capacity and reliability of the rail services we rely on in East Hampshire is very welcome.”
Business has been given a boost with the confirmation that corporation tax will be cut to 17% by 2020 - the lowest in the G20 - and access to £400 million of funding through the British Business Bank for innovative small businesses.
The increase in Rural Rate Relief from 50 to 100% was also confirmed for introduction in April 2017 - saving a business up to £2,900 a year – and is available in areas with a population under 3,000 where the business is either the only village shop or post office (with a rateable value of up to £8,500) or the only pub or petrol station (with a rateable value of up to £12,000).
Damian concluded:
“The backdrop for this Autumn Statement is challenging but it delivers more support and help for working families, backs businesses, and is investing in much needed infrastructure projects and world-class digital technologies. All of these are important to make sure we have an economy fit for the future.”