Rishi Sunak unveiled several measures to combat the cost-of-living crisis, including the threshold at which people start paying National Insurance and a 5p cut to fuel duty.
Mr Sunak says the measures will ‘put billions back into the pockets of people across the UK and delivers the biggest net cut to personal taxes in over a quarter of a century’.
But business experts in Tunbridge Wells have offered a cooler response to the spring statement.
Neill Thomas, partner and managing director at Thomas Mansfield Solicitors, said: “On the face of it, the Spring Statement was a sign of encouragement but as usual, what he’s given with one hand he has taken away with the other.
“Although the increase in the Employment Allowance from £4,000 to £5,000 was welcome as it will mean eligible employers will be able to reduce their employer National Insurance Contributions bills by up to £5,000 per annum, there was no news on reforming business rates, which have long been the bugbear of small business, and adding to the increase in overheads at a time when shops and offices are still far from being fully utilised.
“There was also no news about assistance for the leisure industry. Pubs and restaurants are trying to attract customers back to recover some of their losses from shutdown during Covid but on April 1 will be hit with the reintroduction of the standard 20 per cent VAT rate on food, which had been temporarily reduced to 12.5 per cent.”
Darren Austin from accountancy firm Synergee said the chancellor faced a ‘perfect storm’ but that the statement lacked ‘substance’.
“Rishi Sunak had little room to manoeuvre in the Spring Statement. The cost of supporting the country over the last two years of the pandemic have left the coffers bare,” he said.
“In addition, the fuel crisis and inflation are a perfect storm with the Office for Budget Responsibility forecasting the biggest real hit to household income since comparable records began in the 1950s.
“Mr Sunak is a conservative and believes in low taxes, but we currently have a significantly high overall tax burden with the Spring Statement doing little to change this.
“On the plus side, the threshold at which employees and self-employed will commence paying National Insurance (NI) has increased.”
He continued: “Overall, a confidently delivered statement but with little actual substance to ameliorate the cost-of-living issues that are happening now.”