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Winners and losers in Hammond's first budget Winners and losers in Hammond's first budget
(35 minutes later)
WINNERS Winners
• Women (or at least, some of them)• Women (or at least, some of them)
Not quite a surprise this, since, as Hammond noted with a slight dig at his boss, Theresa May had already announced several of his grabbiest goodies ahead of International Women’s Day. These included an additional £20m over the next three years to organisations working with victims of domestic violence, and £5m to help those who have taken a career break – acknowledged largely to apply to women who have taken time out to have children – to return to work. In addition, Hammond announced £5m to fund commemoration of the centenary next year of women getting the vote. While the measures are eye-catching, however, the sums are tiny in budget termsNot quite a surprise this, since, as Hammond noted with a slight dig at his boss, Theresa May had already announced several of his grabbiest goodies ahead of International Women’s Day. These included an additional £20m over the next three years to organisations working with victims of domestic violence, and £5m to help those who have taken a career break – acknowledged largely to apply to women who have taken time out to have children – to return to work. In addition, Hammond announced £5m to fund commemoration of the centenary next year of women getting the vote. While the measures are eye-catching, however, the sums are tiny in budget terms
• Sadiq Khan• Sadiq Khan
London’s mayor expressed delight at a new deal with the Treasury which he described as a big step “towards London getting the control we need” in the post-Brexit economy. Under the new arrangements, City Hall and central government will explore new ways to fund transport infrastructure, tackle congestion and devolve criminal justice services. The mayor and London boroughs will also get new powers to manage local business rates and careers and employment services.London’s mayor expressed delight at a new deal with the Treasury which he described as a big step “towards London getting the control we need” in the post-Brexit economy. Under the new arrangements, City Hall and central government will explore new ways to fund transport infrastructure, tackle congestion and devolve criminal justice services. The mayor and London boroughs will also get new powers to manage local business rates and careers and employment services.
• Publicans• Publicans
The chancellor heard the clamour of protest at the imminent revaluation of business rates, which means sharp rises for many, particularly in London and the south-east, and promised three measures that he said amounted to an extra £435m cut in the rates.The chancellor heard the clamour of protest at the imminent revaluation of business rates, which means sharp rises for many, particularly in London and the south-east, and promised three measures that he said amounted to an extra £435m cut in the rates.
These included a cap for some small businesses that would lose a tax relief under the changes, limiting the impact of rises, and a £300m fund available to councils to allow them to alleviate particular “hard cases” in their local areas. Most notably, 90% of pubs will get a £1,000 discount on their new rate bills. Alcohol duties, meanwhile, will remain unchanged.These included a cap for some small businesses that would lose a tax relief under the changes, limiting the impact of rises, and a £300m fund available to councils to allow them to alleviate particular “hard cases” in their local areas. Most notably, 90% of pubs will get a £1,000 discount on their new rate bills. Alcohol duties, meanwhile, will remain unchanged.
• The social care system• The social care system
Hammond could hardly have ignored the growing alarm over the crisis in the social care system and its knock-on impact on the NHS, and, accordingly, he announced an additional £2bn for adult social care over the next three years. With half of that available in 2017-18, Hammond said local authorities would be able to act now to improve services in their areas. But critics pointed out that this left just £500m for the two following years, dismissed by many as far from enough given the scale of the need.Hammond could hardly have ignored the growing alarm over the crisis in the social care system and its knock-on impact on the NHS, and, accordingly, he announced an additional £2bn for adult social care over the next three years. With half of that available in 2017-18, Hammond said local authorities would be able to act now to improve services in their areas. But critics pointed out that this left just £500m for the two following years, dismissed by many as far from enough given the scale of the need.
The NHS, meanwhile, will get £100m for new A&E triage services next winter, to alleviate some of the pressure on emergency healthcare.The NHS, meanwhile, will get £100m for new A&E triage services next winter, to alleviate some of the pressure on emergency healthcare.
LOSERS Losers
• Uber drivers• Uber drivers
See also: Deliveroo drivers, couriers, plumbers, cabbies and others working in the so-called “gig economy”. For reasons of fairness, the chancellor said, the differences in tax paid by employees and those who work for themselves had to be addressed, meaning that anyone who is self-employed and earning more than £16,250 a year would have to pay more under new national insurance arrangements for the self-employed.See also: Deliveroo drivers, couriers, plumbers, cabbies and others working in the so-called “gig economy”. For reasons of fairness, the chancellor said, the differences in tax paid by employees and those who work for themselves had to be addressed, meaning that anyone who is self-employed and earning more than £16,250 a year would have to pay more under new national insurance arrangements for the self-employed.
Part of his reasoning, Hammond said, was that the current discrepancy in tax paid by employees and the self-employed was driving a significant move towards people working for themselves, but he faced immediate criticisms that he had reneged on a 2015 manifesto pledge committing the government to “no increases in VAT, income tax or national insurance”.Part of his reasoning, Hammond said, was that the current discrepancy in tax paid by employees and the self-employed was driving a significant move towards people working for themselves, but he faced immediate criticisms that he had reneged on a 2015 manifesto pledge committing the government to “no increases in VAT, income tax or national insurance”.
• Directors and shareholders in small businesses• Directors and shareholders in small businesses
Another measure that has gone down badly in the business community was Hammond’s reduction of the tax-free dividend allowance for directors or shareholders of small companies from £5,000 to £2,000. The allowance is just a year old, having been introduced by George Osborne in 2016, but the chancellor argued that the greatest beneficiaries of the perk were well-off investors, and said the change was part of his plan to make small business taxation fairer.Another measure that has gone down badly in the business community was Hammond’s reduction of the tax-free dividend allowance for directors or shareholders of small companies from £5,000 to £2,000. The allowance is just a year old, having been introduced by George Osborne in 2016, but the chancellor argued that the greatest beneficiaries of the perk were well-off investors, and said the change was part of his plan to make small business taxation fairer.
• Tax avoiders• Tax avoiders
Every chancellor likes to say they are clobbering tax avoiders, and Hammond was no exception, vowing to introduce measures that he said would reclaim £820m. These include a new penalty for “enablers of tax avoidance”.Every chancellor likes to say they are clobbering tax avoiders, and Hammond was no exception, vowing to introduce measures that he said would reclaim £820m. These include a new penalty for “enablers of tax avoidance”.