What Jeremy Hunt’s Autumn Statement Means For You And Your Bank Balance

He and Prime Minister Rishi Sunak are trying to plug the “fiscal black hole” at the heart of public finances. It comes as inflation reaches 11.1% and the country having already entered a recession in the wake of the disastrous unfunded tax cuts in the mini-budget.

Taxes as a proportion of the UK’s national income will increase by just over 1% over the next five years – but it will still mean we are facing the highest tax burden for at least the last seven decades.

The Office for Budget Responsibility also estimates that there will be around 3.2 million extra taxpayers as a result of the budget.

So, here’s a breakdown of all the jargon, an explanation of what this statement means in real terms for your finances – and why critics claim we’re in a “doom-loop”.

Energy bills

The Energy Price Guarantee will now stay in place until March 31, 2024.

The scheme meant that the government would make sure the average household only paid around £2,500 for their annual energy bill.

However, from April 2023 rates will be increased by 20% (so the average bill will cost around £3,000).

If the total cost of energy decreases though, price caps will reduce too.

Without the government’s backing, it’s thought that people could be paying up to £3,700 per year for energy by now.

Hunt also announced that much of this funding would come from an increased windfall tax. This is the tax North Sea oil and gas firms have to pay on excess products.

Now, it will go up from 25% to 35% from January 1 next year – a measure which will remain in place until March 2028.

This will apply to electricity generators too, through a temporary 45% levy.

Together, this should raise £14 billion, according to the chancellor.

- Advertisement -

Comments are closed.