On March 15, the Chancellor of the Exchequer announced a series of measures aimed at achieving long-term, sustainable economic growth in the UK.
The headline announcements included a £27 billion tax cut for businesses, a radical ‘full expensing’ policy and capital allowances reform to drive investment and growth.
Additionally, the government plans to simplify tax for small and medium-sized enterprises, benefiting over 340,000 businesses in Scotland alone.
The government also announced measures to ease the cost-of-living burden on households, including freezing energy prices and duties on fuel and beer.
The Chancellor also pledged to remove barriers that prevent people on benefits, older workers, and those with health conditions from working.
The government plans to catalyze 12 high-potential knowledge-intensive growth clusters across the UK, including four in Scotland, Wales, and Northern Ireland through its refocused Investment Zones programme.
The Chancellor’s Spring Budget also confirmed that many of the decisions on tax and spending apply in Scotland, Wales, and Northern Ireland.
As a result, the Scottish government is set to receive an additional £320 million over 2023-24 and 2024-25.
The childcare system is set to undergo significant reforms aimed at removing barriers to work for parents receiving Universal Credit.
The government will pay the childcare costs of parents moving into work or increasing their hours upfront, rather than in arrears, and will increase the maximum amount parents can claim by around 50%.
The government is committed to removing barriers to work facing those on benefits, those with health conditions, and older workers.
The Chancellor set out a plan to increase the pensions annual allowance from £40,000 to £60,000, abolish the Lifetime Allowance, and expand the midlife MOT offer to provide the best possible financial, health, and career guidance ahead of retirement.
The Chancellor’s plan to boost innovation and business investment includes a ‘full expensing’ policy and an extension to the 50% first-year allowance, a transformation in capital allowances worth £27 billion over five years.
Generous reforms to tax reliefs for the creative sectors will protect theatres, orchestras, museums, and galleries against ongoing economic pressures.
The government will provide £900 million of funding for an AI Research Resource and an exascale computer, and a commitment to a £2.5 billion ten-year quantum research and innovation programme through the government’s new Quantum Strategy.
The government also plans to level up growth across the UK by empowering local communities to command their economic destiny.
Business rates retention will be expanded to more areas in the next Parliament, and the government will deliver 12 Investment Zones across the UK, including four in Scotland, Wales, and Northern Ireland.
Local growth projects will also receive support in every nation of the UK.
Overall, the Spring Budget reflects the government’s commitment to achieving long-term, sustainable economic growth that delivers prosperity with a purpose for the people of the United Kingdom.
»UK Spring Budget 2023: Measures to Ease Cost-of-Living Burden and Boost Innovation«
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