The Chancellor has delivered his Budget to the nation, including changes that will affect businesses, schools, families on Universal Credit and even smokers.
From next April, workers on the basic rate will get a pay rise – although it’ll be bittersweet for many who will find their savings eroded by a 1.25% tax hike.
Elsewhere, alcohol duty is being "radically" simplified by introducing a system designed around the principle of "the stronger the drink, the higher the rate".
In short, the price of sparking wine will drop as tax it is reduced to £2.88 a litre, although whiskey and vodka are rising in price.
A "draught relief" will apply a lower rate of duty on draught beer and cider, cutting the tax by 5% on drinks served from draught containers over 40 litres and bringing the price of a pint down by 3p.
A planned rise in fuel duty has also been cancelled because of pump prices being at their highest level in eight years.
Parents will also get additional support in the form of a £300million grant that will go towards "a Start for Life" parenting programme.
Universal Credit
If you're on Universal Credit you could be left with a pretty big windfall in an unexpected announcement made by Rishi Sunak today.
Universal Credit starts to be phased out when you start earning again. For every £1 you earn, your Universal Credit was in the past cut by 63p.
However, this figure, known as the Universal Credit earnings taper rate, will be reduced to 55p, leaving you with an extra 8p per pound to spend.
The chancellor estimates that about two million families will benefit by around a £1,000 pounds a year.
But since it is targeted at those with jobs, it won’t help people unable to work, including those with disabilities.
More to the point, it will help far fewer people than the 5.5million who benefited from the £20 uplift.
Energy bills
As shadow chancellor Rachel Reeves pointed out after his speech, Mr Sunak did not make any promises to help households with the runaway bills sparked by a spike in gas prices.
There were hopes he would suspend energy VAT to give households some relief, while others hoped he would increase the warm home or winter fuel discounts.
However, neither got a mention.
From April the price cap on energy bills is expected to rise to around £1,660 for an average household, from £1,277 today.
A Treasury paper acknowledged that European gas prices had risen by 471% in the year to September, but it did not announce any steps to reduce soaring gas bills.
Smokers
Duty rates on cigarettes will increase by the rate of RPI inflation plus 2%.
Meanwhile, the rate on hand-rolling tobacco will increase by RPI inflation plus 6%.
RPI is currently sitting at 4.9%, which means cigarettes go up by 6.9% and rolling tobacco by a whopping 10.9%.
This means the priciest pack of 20 cigarettes that cost £13.50 will rise by 93p to £14.43, while the cheapest pack of 20 cigarettes will go up by 61p from £8.80 to £9.41.
The cost of a 30g bag of tobacco will jump by 89p from £8.14 to £9.02.
Holidaymakers
The price of petrol is likely to be lower after the Chancellor announced he was scrapping a planned hike in fuel duty.
Mr Sunak said he would freeze fuel duty at 57.95p per litre for the year ending March 2023. The decision comes after petrol prices pushed to their highest point in eight years late last week.
Controversially, days before the UN climate change summit in Glasgow, the Chancellor also said he would cut air passenger duty for domestic flights by 50% to £6.50.
However a new levy will come into place for those who travel 5,500 miles or more. The new £91 duty means the amount of tax you pay will depend on how far you’re flying.
Pub-goers
If fortified wine or high strength white cider are your thing, your drinks tab is about to go up. The Government will increase tax on these because of their high alcohol content.
But lower-alcohol drinks such as fruit cider, liqueur and rose wine will have lower taxes.
If you like craft cider you might also see your bills go down as small producers will for the first time be eligible for tax relief.
Draught beer served in pubs will also see a duty cut, the Chancellor said. The reforms will come into effect in February 2023.
In short, all booze will now be taxed in the following way, based on strength.
One rate will apply to drinks between 1.2% and 3.4%, then others on 3.5% to 8.4%, 8.5% to 22% and 22% and above.
Here are some examples of how prices will change:
- Stella Artois, pint - down 3p from £3.80 to £3.77
- Frosty Jacks cider, 750ml bottle - up 45p from £3.70 to £4.15
- Kopparberg strawberry and lime cider, pint - down 13p from £3.80 to £3.67
- Hardy's Merlot wine, 750ml bottle - up 35p from £7 to £7.35
- Blossom Hill rosé, 750ml bottle - down 12p from £8 to £7.88
- Buckfast fortified wine, 750ml bottle - up 81p from £8.50 to £9.31
- Bailey's Irish cream, 750ml bottle - down 41p from £17 to £16.69
Workers on the minimum wage
The minimum age will rise to £9.50 an hour for those aged 23 and over next April.
Speaking during today’s Autumn Budget, the Chancellor confirmed how much those on the basic income will see their pay rise in the next year.
The National Living Wage will increase from £8.91 to £9.50 an hour – a 59p an hour boost.
Rishi Sunak also announced a wage rise for young people under the age of 23.
For those aged 21-22 the National Minimum Wage rate will rise to £9.18 an hour, up from £8.36 – an 82p increase.
Apprentices in industries like construction seeing their minimum hourly pay increase by nearly 12%, going from £4.30 to £4.81 an hour.
But many workers will see the pay boost eroded by a new National Insurance hike next April and a 3.1% jump in the cost of living.
The Chancellor today warned inflation could rise to 4% by Christmas - meaning huge increases in the cost of living.
All working adults, including those over the state pension age, will pay the levy.
It will then become a health and social care levy from April 2023. Under it, the average worker will pay an extra £255 a year to pay for reforms to social care and NHS funding in England.
Higher earners on £50,000 per year would pay an extra £505.
If you live in a building with cladding
The Residential Property Developers Tax will be levied on multi-billion housebuilders with profits over £25million at a rate of 4% to help raise £5billion to remove unsafe cladding from the highest risk buildings, Rishi Sunak said.
After 2017's Grenfell disaster, many tower blocks were found to be unsafe.
The scandal left hundreds of thousands of leaseholders across the country facing huge bills to remove dangerous cladding from their homes – unable to sell or mortgage.
In February, Housing Secretary Robert announced the government would pay £3.5billion to guarantee no private leaseholders pay for cladding removal or remediation in buildings over 18 metres, or six storeys, high in England.
But flat owners in blocks of four to six storeys - or 11 to 18 metres - will still have to take out a loan to remove cladding, which will be repayable at up to £50 a month for "many years".
Many say these could amount to more than their home is worth.
Is the funding enough? Let us know in the comments below
If you’re a pub or shop owner
A new 50% business rates discount will apply in the retail, hospitality, and leisure sectors, with eligible businesses able to claim a discount on their bills of up to a maximum of £110,000.
The Chancellor said this will benefit around 90% of businesses across the sectors.
Mr Sunak said the new temporary relief rate will take place for 2022-23 and be worth around £1.7billion.
The Chancellor also highlighted that rates revaluations will now take place every three years, replacing current five-year gaps.
