Interactive Investor

Spring Budget preview: what should you expect?

Craig Rickman rounds up the rumour mill on the eve of the Budget.

4th March 2024 15:54

Craig Rickman from interactive investor

This year’s Spring Budget will take place on Wednesday 6 March and the stakes are high.

It could be the government’s last chance to sway voters before a general election, which has fuelled the prospect of tax giveaways – but Jeremy Hunt’s headroom appears limited.

So what might we expect? Let’s round up the rumour mill.

First, personal taxes.

Tight fiscal forecasts mean the chancellor may cut employees’ national insurance instead of income tax, with the main rate reducing from 10% to 9% reportedly being considered.

Now, scrapping inheritance tax would certainly find favour at the polls, but this seems more aspirational than realistic.

However, as Hunt recently described IHT as "pernicious", he may choose to chop the 40% headline rate or shake up the tax-free allowances.

Next up, investments and savings.

There are reports the government may axe stamp duty on UK shares.

Elsewhere, a Great British ISA, which would give savers an extra £5,000 to invest in UK-listed companies, didn’t materialise at last year’s Autumn Statement, is apparently still on the table.

And the Lifetime ISA’s early withdrawal penalty could be cut from 25% to 20%, while the maximum home value may tick up from its current £450,000 cap.

And last, child benefit.

At present, if either parent earns above £50,000, they face a charge on child benefit payments, creating a potential 71% tax trap. Given Hunt has conceded the current system is unfair, reform here is a possibility.

Also look out for changes to non-dom tax rules and support for first-time buyers.

This is purely speculation – and Hunt could squeeze in another Budget before an election.

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