Property Industry Eye Marc Da Silva
The chancellor Jeremy Hunt has just concluded delivering his 2024 Budget.
He also confirmed that the OBR’s forecast for UK economic growth remains broadly unchanged from what it forecast at last November’s Autumn Statement.
Gross domestic product will be marginally higher this year at 0.8%. In 2027, the OBR projects that the economy will grow by 1.8% compared to November’s prediction of 2%. By 2028, it will drop to 1.7%.
Successive interest rate rises and cost-of-living pressures weighing heavily on household budgets have impacted the UK housing market significantly over the past couple of years, and so there was a lot of interest in today’s Budget announcement from the property industry to see what measures would be introduced to provide a much-needed boost for the sector.
Of note, the chancellor announced that capital gains tax is to be reduced from 28% to 24%, with a view to boosting revenues and increasing property transactions.
He has also announced that the government is scrapping stamp duty relief for people buying more than one dwelling.
Additionally, the chancellor says he will scrap tax breaks which make it more profitable for second home owners to let out their properties to holiday makers rather than to long-term tenants to rent.
Hunt says he will abolish the furnished holiday lettings regime.
Additional highlights:
+ A further 2p cut to National Insurance – following the 2p reduction which was announced in the Autumn Statement.
+ Non-dom tax regime, for UK residents whose permanent home is overseas, to be replaced with new rules from April 2025
+ Full child benefits to be paid to households where highest-earning parent earns up to £60,000, limit is £50,000 currently
+ Partial child benefit to be paid where highest earner earns up to £80,000
+ The Household Support Fund, which allows local councils to help families via food banks, warm spaces and food vouchers, will be extended beyond 31 March. It will continue for six months, Hunt says.
+ Fuel duty will remain at its current rate and be frozen for the next 12 months; “temporary” 5p cut on fuel duty which was due to end this month will be extended.
+ The threshold for VAT registration will go up from £85,000 to £90,000.
+ New British ISA: An extra £5,000 tax-free allowance for the public to invest exclusively in UK.
+ Longer repayment period for people on benefits taking out emergency budgeting loans from the government
+ £90 fee to obtain a debt relief order scrapped
+ Government fund for people struggling with cost of living pressures to continue for another six months
