Budget Oct 24 Thread

Imo our last chance to back out of HS2 was back in Boris times of 2019, the project had bought the land and properties which at the time had increased in value dramatically. Boris hit the button to put boots on the ground and it’s been a money pit ever since that’ll never see a return. It’s either keep spending or have another national f up.

Pay per mile needn’t be expensive to run. Mileage is logged each year at MOT time, so you could just add the mileage component to VED each year

Google “mileage correction services”. For something which should be pretty rare (switching motors between cars and similar) there are a lot of companies providing it.  It would require significant effort from the car companies (which then leaves a question about all the old cars) to make this a secure option.

For something which should be pretty rare (switching motors between cars and similar) there are a lot of companies providing it.

I assume it’s because PCP / Lease stuff is based on mileage. GPS black box trackers seems the obvious choice – already working well for young drivers.

Well!

Sunak obviously didn’t get his flight booked in time. Lol

Glad to see businesses rates relief hasn’t been completely removed for retail as previously thought. But a drop to 40% will still be a big hit to the high street … Expect lots of small shops to close over the next year.

Full thing here: https://assets.publishing.service.gov.uk/media/672232d010b0d582ee8c4905/Autumn_Budget_2024__web_accessible_.pdf

LLM summary (makes it a lot quicker to read!):

Employer/Employment Taxes:

Employer NICs increasing from 13.8% to 15% from April 2025

Secondary Threshold for employer NICs reduced from £9,100 to £5,000

Employment Allowance increased from £5,000 to £10,500 with £100,000 threshold removed

Capital Gains Tax (CGT):

Lower rate increasing from 10% to 18%

Higher rate increasing from 20% to 24%

Business Asset Disposal Relief (BADR) and Investors’ Relief rates:

Increasing to 14% from April 2025

Further increasing to 18% from April 2026

Inheritance Tax:

Extension of threshold freezes until April 2030

Unspent pension pots brought into IHT scope from April 2027

Changes to Agricultural Property Relief and Business Property Relief:

100% relief for first £1m of combined assets

50% relief thereafter

50% relief for AIM shares

Private Schools:

VAT at 20% on school fees from January 2025

Removal of business rates charitable relief from April 2025

Energy/Oil & Gas:

Energy Profits Levy rate increased to 38%

Investment allowance abolished except for decarbonisation

Levy extended until March 2030

Property Taxes:

Higher rate of Stamp Duty for additional properties increasing from 3% to 5%

Business rates: 40% relief for retail, hospitality and leisure sectors (capped at £110,000)

Small business multiplier frozen for 2025-26

Vehicle/Transport Taxes:

Fuel duty frozen and 5p cut extended for one year

Vehicle Excise Duty changes to increase differentials between EVs and other vehicles

Air Passenger Duty rates increasing from 2026-27 (£2 more for economy short-haul)

Other Taxes:

Non-dom status abolished and replaced with new residence-based system from April 2025

Carried interest taxation moving to income tax framework from April 2026

New vaping products duty at £2.20 per 10ml from October 2026

Tobacco duty escalator of RPI+2%

Alcohol duty:

Cut on draught products by 1p per pint

Other rates increasing with RPI

Soft Drinks Industry Levy rates increasing to reflect inflation since 2018

ISAs/Savings:

ISA subscription limits frozen until April 2030:

£20,000 for adult ISAs

£9,000 for Junior ISAs

£4,000 for Lifetime ISAs

LLM summary (makes it a lot quicker to read!):

I’m not sure about that! 😉

Edit: It’s formatted now.

Sunak is having some fun in his final speech but his message of ‘We warned Labour would tax, borrow and spend’ only shows why he’s in opposition. Yes Rishi, everyone knew that and that’s why they voted Labour!

Yes Rishi, everyone knew that and that’s why they voted Labour! – only not everyone did vote Labour. It was only about 22% so hardly everyone !!

I would happily pay a bit more tax if it meant things were working again & we got to live in a fairer society.

I’d far rather have a society (well OK, a Government) that was able to work on long-term plans, accept that going for the cheapest option now to “save money” would actually cost more in the long run, accept that penalising the poorest in society simply fuels crime and accepts that the richest in society should pay considerably more.

The issue is not the amount of tax we pay; it’s how it’s been mismanaged over decades through successive governments and a host of poor policy decisions.

only not everyone did vote Labour

Yep, from 2010 to ’19. There in lies the problem. 😉

It was only about 22% so hardly everyone !!

Yes of course, but enough to win them a large majority.

I’m actually quietly impressed by that budget. Really don’t know why Starmer boxed himself into a corner with the promise of no tax rises for workers but you can’t deny the scale and reach of it. Would have liked to see higher CGT rates and wealth taxes on second homes etc but it’s tipped the balance both in terms of spending and taxation and more importantly it changes the optics of what govt should be doing. Instead of fiddling at the edges and finding reasons not to do anything this budget shows Labour do want to make big decisions and do big things. We can argue about the detail but this IMO is the most important change from life under the tories.

Yep, best budget in (14) years…

I’m disappointed to see no increased focus on tax avoidance and closing the loopholes.

Non-dom status abolished and replaced with new residence-based system from April 2025

on the face of it good news. However because I’m a cynic I will await with interest to see if it’s just a name change or if they actually creates a material increased tax liability for those with non dorms status

All seems fairly benign in the end. I’m pleased because it wasn’t as bad as I was expecting. Maybe that was the plan all along? Hopefully that’s the bad news budget out of the way and we can let the good times roll from now on

Hopefully that’s the bad news budget out of the way

A 64bn boost in public spending is bad news? If that’s Labour being pessimistic there must be some properly radical big stuff on the way!

Removal of business rates charitable relief from April 2025
Employer NICs increasing from 13.8% to 15% from April 2025
Secondary Threshold for employer NICs reduced from £9,100 to £5,000

As a modest size charity, that is going to sting for my work.

Fiscal drag on your income tax for another three years. Blaming the previous government for not making a change of course. The proportion paying 40% income tax will continue to rise. https://ifs.org.uk/publications/deepening-freeze-more-adults-ever-are-paying-higher-rate-tax

In a roundabout way I’m happy with this.  Incentivizes me to plough it into the pension and retire early (maybe not the best to the overall economy though).

Thanks to fiscal drag I think it’s now possible to have a below average household income (eg one partner on £55k and the other part time on £10k with a few kids in tow) and yet be paying higher rate tax.

Maybe, but in that hypothetical scenario the difference between them and a household with two full time incomes is offset against the savings in childcare?  Also the higher earning partner in that example is only paying ~£1k more because it’s a marginal rate.

Google “mileage correction services”. For something which should be pretty rare (switching motors between cars and similar) there are a lot of companies providing it.  It would require significant effort from the car companies (which then leaves a question about all the old cars) to make this a secure option.

I suppose for the most blatant cases there’s ANPR.

Fraud will always be an issue, just like you could avoid paying road tax today by cloning someone else’s number plate. I suppose you could then prosecute “mileage correction” in the same way you would a dodgy accountant.

 Fuel duty frozen and 5p cut extended for one year

Bonkers considering fuel is so cheap right now.  But I suppose politically it keeps tax rises hidden from “working people”.  They could have at least brought it back and said it’s being hypothecated into fixing potholes and subsidizing bus fares.

 that perceived unfairness only exists because the higher rate tax threshold exists. Arguably the higher rate tax threshold itself is unfair, at least insofar as where it’s now positioned.

I think we all need to get used to the idea of paying more tax to pay for more services (i.e. longer retirements and more advanced healthcare).  Maybe think of it the other way round, 40% is heading to be the new normal and there’s a discount for lower incomes.

But also bear in mind that just because the ‘average’ (for middle aged men) is knocking on the threshold, that means that they’re not actually paying it (or much of it).

The Shadow Treasury Minister Gareth Davies has just been taken apart by Matt Chorley on Five Live. Dear god, what a dimwit.

He moaned about Labour raising taxes, then when asked how the huge amount of money that the last government hadn’t budgeted for would have been raised by a Tory government he kept repeating that they would use ‘budgetry methods’ to plug the yawning gap

To which he was given the obvious next question ‘you mean you’d raise taxes?’. He then just kept repeating ‘no, we’d use budgetry methods’ and the interview then went round in circles

If thats the best the Tories can muster in reply…

^^ The only thing the Tories dreaded more than losing the last election was winning it, as they would have fallen prey to all their own traps.

Fuel duty frozen and 5p cut extended for one year

Bonkers considering fuel is so cheap right now.

If you did a straw poll of the general population, I think yours would be a somewhat minority viewpoint there.

If you’re on minimum wage and need to drive to work and back every day, I doubt you’d be marvelling at how little it was costing you

I know its a somewhat false equivelence (due to various circumstances) but during covid a litre of unleaded dipped below a quid a litre. Its now £1.35 a litre. Thats a pretty substantial increase in the price of filling a tank over a 3 year period, far outstripping wage growth. Any government would have to be mad to bang another 5-7p a litre on top of that. The usual suspects in the press would go into absolute meltdown!

hypothecated

Every day’s a school day. <Thumbs up.>

I bet it increases the number of people claiming benefits and the number of unemployed will go up , small businesses will suffer. Not sure how it encourages growth

It’s a monumental change in direction and focus to a high tax state. An extra £40bn revenue. Only unfortunately £1bn (peanuts) going to the NHS

during covid a litre of unleaded dipped below a quid a litre.

did it really? I don’t remember that. I remember it hitting £2/L when Ukraine kicked off

Pump prices over time

I’m actually quietly impressed by that budget.

Yeah me too. The extra for public services will be welcomed.

I’m actually quietly impressed by that budget.

Me too. I mean I do feel sorry for the landowners, second home owners, people who are going to inherit enough money to pay inheritance tax and private jet users, obviously, but other than that….

Well this is disappointing.

So many told us that we would pay per mile, that the working man would have their tax increased, that they wanted rid of bus fare cap and they’d not tax the rich. Now I don’t know who to believe, the Daily Mail, Reform voters or Labour.

Overall I quite impressed with what they’ve come up with.

If you did a straw poll of the general population, I think yours would be a somewhat minority viewpoint there.

If you’re on minimum wage and need to drive to work and back every day, I doubt you’d be marvelling at how little it was costing you

a) just shows how unfair the system of enforced car ownership is.  Make public transport better.  It should be the default like public healthcare or state education.

b) it’s ~135p the same price now as it was 10 years ago, I was going to say “as when Labour were last in power, but the price rose quickly over 3 years from ~118 to ~138 due to the financial crisis so It’s about 6 months too late to say Gordon Brown was in power .   Adjusted for inflation, hasn’t been this cheap since 1998.  And that was on the tail end of falling (inflation adjusted) petrol prices from the late 80’s to mid 90’s.

Petrol prices adjusted for inflation by year in a table:

http://www.speedlimit.org.uk/petrolprices.html

On a graph:

ww.racfoundation.org/data/uk-pump-prices-over-time

Only unfortunately £1bn (peanuts) going to the NHS

Someone will be asking to fact check me but I’m fairly sure it’s much more than that?

The lack of fuel duty increase is just incredibly regressive. Fuel now is £1.35 /L(ish). In 2022, it was nearly £2 /L, even with the 5p “temporary” tax cut put in place during Covid.

Increasing the bus fare cap to £3 saves £350m (compared to keeping it at £2).

Keeping fuel duty as is will cost £20bn. Even just a commitment to raise it in line with inflation would have been nice. I despair.

The absolute bollocks about “the working people” and “the hard-pressed motorist”. Never seems to translate to “the working people” who get the bus or the train.

The absolute bollocks about “the working people” and “the hard-pressed motorist”. Never seems to translate to “the working people” who get the bus or the train.

You’re right, but it’s a very politically savvy move. When it comes to budgets the vast majority of people look for two things more than anything else, the price of petrol, and the price of booze. Put those up and you’re onto a loser from day one.

Never seems to translate to “the working people” who get the bus or the train.

Nationalise the trains! Get buses back under local government control! Oh … they are … sweet.

As for fuel duty… I’d agree the fuel price escalator should be restarted ASAP… except there is a very good chance that oil/petrol/diesel prices will shoot up again this winter… a delay seems like wise planning… a sensible precaution.

Generally… this budget is the government getting on with doing what they said they would… inline with the priorities they set out.. all be it in a sensible and cautious way… no rushing… no sidelining the Treasury and OBR… no big surprises… just starting the shift needed, and beginning to repair some of the damage done to us (and by us) over recent years.

did it really? I don’t remember that. I remember it hitting £2/L when Ukraine kicked off

It did, briefly, when the whole world was pretty much in lockdown and not driving anywhere so unless you were on the governments fast lane as a sales rep for PPE or flying a in a private jet you probably didn’t notice.  At one point the price of crude went negative because there was excessive supply and everyone’s strategic reserves were full so they couldn’t support the price any further.

Using that blip as a baseline is being really picky with stats though. As pointed out, you could use the £2 (well, 170ish not on the motorway) figure with more validity because people actually had to pay that to get to work.

Make public transport better. It should be the default like public healthcare or state education.

Yes, but presently it isn’t ‘better’. Its the opposite of ‘better’. In towns like the one I live in it is catastrophically awful after decades of underinvestment and cutting of services. Ask anyone in Greater Manchester if they’d be happy to rely on the ‘service’ provided by Northern Rail to get into work every day and they’ll laugh in your face. Thats the present reality.

I can’t actually get to work using public transport. It simply isn’t possible. Unless I fancy spending 5 hours a day on various buses (GMPTE Journey Planner tells me it would involve 2 buses, then a tram then another bus to travel 14 miles). No thanks. So I have to drive. As does every one of the millions an millions of people in this country who effectively don’t have access to any public transport worthy of the name.

So thats the reality. And its going to take a great deal of time and investment to fix. But I was impressed with the anoiuncement of some actual investment in the transport infrasructure in the north of England. Thats certainly something we’ve not had for a very, very long time. And, of course, the railways are effectively going to be nationalised, and they’re also devolving control over bus srvices to local councils like they’ve just done in Manchester, so its all good. definitely a step in the right direction IMHO

The Beeb have done a simple breakdown for the likes of me.

https://www.bbc.co.uk/news/articles/cx25w7qpr0yo

Dont go into the comments section though, “there be dragons.” ?

As a modest size charity, that is going to sting for my work.

The removal of business rates for charitable status is only for Private schools iirc

fairly sure it’s much more than that?

well yes it is. £1.2bn

Increase in taxation of £40bn. Increased spending of £60bn

I can’t actually get to work using public transport. It simply isn’t possible. Unless I fancy spending 5 hours a day on various buses. No thanks. So I have to drive. As does every one of the millions an millions of people in this country who effectively don’t have access to any public transport worthy of the name.

Manchester transport is uniquely s*** though.

When I was there I hypothesized that it’s because When London’s population hit ~2.5million in around 1850 they started to build the London underground as the exciting transport project of the future that brought the satellite towns into the suburbs. When Manchester hit 2.5million roughly 100 years later it built the M62 and did the opposite.  I don’t know why they both invested in expensive transport schemes at that point i their growth but for some reason they did.

n.b. as part of the whole post war rebuilding that resulted in the M62, London was supposed to get something like 5 orbital ring roads and 8 arterial motorways, even Whitehall was planned to be demolished to make way for them.  Thankfully that sort of large scale town planning fell out of favor (and ran out of money).

One of the huge issues for me.. Someone touched on above..

The short term thinking of elections every 4 years or whatever.. Of course we need elections on a semi regular basis but that encourages MPs just to think in 4 year blocks.. They could be out on thier ass after that…

I think we maybe need a 4th pillar of government for long term projects, such as rail infrastructure, health care, environmental goals etc..

.. Which is sacrosanct.. and the ‘government de jour’ cannot interfere with it, with out cross party support and strict arbitration via an independent body…

I suppose that idea would add another layer of burocacy… And cost.. But.. I think it might be a net gain for society as a whole.