THE government's Autumn Budget is expected to be crucial this year as the country emerges from lockdown.
With experts forecasting a grim outlook for the economy after the coronavirus pandemic, the Treasury will look to introduce measures to help balance the books, boost consumer spending and prevent unemployment.
When is the Autumn Budget 2020?
The next budget will be delivered by Chancellor Rishi Sunak, and is expected to happen in October this year.
This follows a "mini-budget" which the Chancellor unveiled in the House of Commons on July 8. He revealed measures like the Eat Out to Help Out scheme and a cut to Stamp Duty.
Mr Sunak delivered his first budget as Chancellor on March 11.
This was a delayed Budget, originally meant to be delievered in November 2019. The former Chancellor Sajid Javid decided to delay it because of December's general election.
What is Rishi Sunak expected to say in this year's Budget?
The Chancellor is set to unveil a host of measures aimed at keeping unemployment down and consumer spending up.
The measures in the next budget could be less generous than his "mini-budget" however. The Goverment is looking to balance the books after the large amounts of spending during the coronavirus pandemic.
This could be through increasing the tax people pay.
- Petrol price rises?
The Chancellor could increase fuel duty by 5p.
This tax on fuel has remained frozen for a decade and an increase would push up the price of petrol at the pumps for motorists.
- State pension changes?
Mr Sunak wants to shelve the "triple lock" which dictates the amount the state pension rises by each year.
The amount pensioners receive rises each year by either average earnings, inflation or 2.5%, whichever is greater.
- Pension tax break slashed?
Tax relief on pensions contributions could be slashed.
Currently anyone saving into a pension gets this relief at their income tax rate – 20% or 40% for higher earners.
There was previously speculation that the Government would change this to a flat rate for all taxpayers ahead of March's budget.
- Capital gains tax rise?
Capital gains tax (CGT) rates could be brought into line with income tax.
Income tax rates are higher than CGT rates. CGT is a tax on profits made when selling certain assets.
- Inheritance tax revamp?
The Government could also set it's sights on a shake up of inheritance tax (IHT).
IHT is a tax paid when passing on estates worth over a certain amount.
- Online sales tax?
An online sales tax could be introduced to help the high street.
Bricks and mortar shops on the high street pay business rates but there is not an equivalent tax for online-only stores.
- Corporation tax rise?
A corporation tax rise could also be announced in the budget.
This is the tax that businesses pay and is currently set at 19%.
What was in the last budget?
In Mr Sunak's July "mini-budget" there was support for people financially and a boost for the economy. That included:
- Eat Out to Help Out
The scheme offering half price meals out has encouraged people to head to restaurants and cages across the country.
- Stamp duty holiday
Homebuyers will benefit from the tax break on properties worth under £500,000 until March 31 2021.
- VAT slashed
A sales tax cut on eating out and other activities is expected to save Brits £160 per year.
Mr Sunak's budget in March 2020 was the biggest Treasury splurge in 65 years, and came just two weeks before the country entered lockdown.
Here's a round-up of the key policies announced:
- The coronavirus rescue plan
The chancellor's headline policy was a £30billion coronavirus rescue plan.
This included a shake-up of sick pay and huge tax cuts to help businesses.
- Changes to universal credit
Mr Sunak also announced significant changes to Universal Credit and the benefits system.
From October 2021, those on Universal Credit who take out an advance payment will be able to pay it back over two years.
The maximum amount that can be taken off your benefits to pay back advance loans was also reduced from 30 per cent to 25 per cent.
- Fuel duty freeze
The Chancellor froze fuel duty for the tenth year in a row.
Mr Sunak cancelled a scheduled 2p-a-litre tax rise at the pumps due in April in a move that pleased motorists.
- Business rates discount
Pubs were helped with a business rates discount soaring from £1,000 to £5,000.
The chancellor also confirmed that a planned rise in beer duty wasscrapped.
He said: "Because of decisions I’ve taken elsewhere in the Budget, I am also freezing duties for cider and wine drinkers as well."
Why isn’t it called the Autumn Statement any more?
The Autumn Statement was scrapped by Philip Hammond in 2016.
At the recommendation of the Institute for Fiscal Studies (IFS), there is now a Spring Statement instead, with the Budget presented later in the year.
The government has said that changing the tax system once a year, rather than twice, will lead to greater financial stability.
The General Election in 2019 and the coronavirus pandemic have disrupted this planned schedule. But the next budget is expected to take place in October.
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