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The Chancellor attends the Resolution Foundation, Economy 2023 Event

Chancellor schedules Spring Budget for 6 March


Jeremy Hunt has set the date for the Spring Budget, sparking rumours of an early General Election and a slash in inheritance tax. 

29th Dec 2023
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The Chancellor has announced that the Spring Budget will be on 6 March.

Hunt has also instructed the Office for Budget Responsibility (OBR) to prepare an economic and fiscal forecast, giving them the required 10 weeks notice to pull together the twice yearly analysis. 

Is inheritance tax up for the chop?

Soon after the announcement, speculation resumed again that the government was gearing up to cut inheritance tax. There had been reports in September that the Chancellor was considering a cut to inheritance tax in the Autumn Statement but opted to cut national insurance instead. 

According to The Telegraph, the Chancellor is considering scrapping inheritance tax as a “gear change” to curry favour with voters ahead of a General Election. He is also said to be looking at reducing the basic rate of income tax and increasing the 40% threshold. 

The government has since downplayed any potential axing of inheritance tax, although it has reportedly not ruled out changes to stamp duty

News of the Spring Budget comes after a more lively than expected Autumn Statement, which included a bumper crop of tax announcements. The headline announcement back in November’s fiscal statement was a 2% cut to national insurance and permanently extending the 100% full expensing capital allowance scheme. 

The national insurance cut to 10% is set to come into force from 6 January. The timing of this cut led some commentators, including PTP’s Giles Mooney, to wager that a General Election may be coming in May, as purdah would prevent anything meaty in the Spring Budget having time to be passed. So as Mooney said at the time, “the [Autumn Statement] is his last chance.”

Rabbits coming out of hibernation

However, while the Chancellor pulled some unexpected rabbits from his hat in the Autumn Statement, many expect the government to use the Spring Budget as a tax cutting springboard into a General Election.

As Paul Aplin, the past president of the ICAEW, wrote after the Autumn Statement on AccountingWEB:  “I suspect some of the widely trailed potential rabbits that didn’t make it to the Chancellor’s speech will reappear in the spring. That’s the way with rabbits.”  

The government will have a little more headroom to roll out tax cuts in the Spring after inflation has fallen from 4.6% at the time of the Autumn Statement to 3.9%. While the fall is encouraging, the rate of inflation is still a distance from meeting the Bank of England’s target of 2%.    

The Spring Budget will be a week before the Festival of Accounting & Bookkeeping on 13 and 14 March at Birmingham’s NEC arena, where attendees will likely have the opportunity to understand the devil in the detail of the Chancellor's tax plans. 

What are you expecting the Chancellor to announce on 6 March?

Replies (5)

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By neiltonks
29th Dec 2023 15:19

I can't see how a cut to Inheritance Tax is supposed to bolster the Tories' election prospects. The vast majority of the population see it as a tax on the landed gentry, think it will never apply to them, and will see a cut as the Tories looking after the rich. We all know that's not quite the case, but the popular view of this tax won't alter any time soon.

Thanks (1)
Replying to neiltonks:
paddle steamer
03rd Jan 2024 11:28

I more tend to find people think IHT will apply to them when it will not. In my experience it tends to be one of those taxes which carries vast ignorance, especially amongst unrepresented taxpayers who often think their estates will suffer when in reality, with transfer of spousal nil rate bands etc , they likely will not.

( I think I have explained at least ten times over the Sunday dining table, to my Mother in Law and her children, my Brother in Law and my Wife, that they are all concerned over nothing- it reinforces my view that to get people to listen to what you say you probably ought to charge them a fee.)

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Replying to DJKL:
By We're_all_mad_here
05th Jan 2024 10:42

This is my view also. The majority of people who 'worry' about IHT will in most cases will never have estates chargeable to IHT.

When you add the fact that the Conservative voter base generally tends to be older than those who vote for the other parties, I do not think that it is out of the question that a change to IHT may be on the cards. Of course I entirely disagree with such a policy but there we go!

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By FactChecker
29th Dec 2023 15:32

“I suspect some of the widely trailed potential rabbits that didn’t make it to the Chancellor’s speech will reappear in the spring. That’s the way with rabbits.”

Let's hope then that the various viruses currently mutating across the country don't lead to the re-appearance of myxomatosis (the scourge of tens of millions of rabbits in my youth).
Although the cynic in me says that a 'nice juicy plague' might yet save their skins (politicians that is, not bunnies).

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By Nebs
03rd Jan 2024 21:00

If past budgets are anything to go by then we will hear all the important bits over the next 8weeks as they are leaked to the press. Then the changes that get favourable press will find their way into the budget speech, while the least favourable will be dropped.

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