In his Spring Statement, UK Finance Minister (commonly referred to as the Chancellor of the Exchequer) Rishi Sunak confirmed on Wednesday that fuel duty taxes in the UK would be reduced by GBP 0.05 per liter as expected. The cut will remain in place until March 2023 and will take effect from 1800GMT on Wednesday. The tax relief is estimated to be around GBP 5B in total.
Sunak also announced a new increase to the National Insurance payment threshold, raising it by GBP 3,000 this year to put it in line with the Income Tax threshold, meaning workers in the UK can earn just over GBP 12,500 without paying any Income Tax or National Insurance. Raising the threshold will add about GBP 6B to the economy per year.
UK Office for Budget Responsibility (OBR) also released its latest forecasts for UK growth and the budget deficit. In the 2021/2022 tax year, the UK economy is forecast to have grown 3.8% (revised lower from 6.0% last October) and the budget deficit is forecast to stand at 5.4% (revised lower from 7.9% in October).
Market Reaction
GBP doesn't seem to have reacted to the latest remarks from Sunak, whose announcements were largely in line with expectations.
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