As part of his Spring Statement, the Chancellor of the Exchequer, Rt Hon Rishi Sunak MP, has announced a raft of tax cuts to help working people during the cost of living crisis.
Among the measures is an instant 5p cut to fuel duty for 12 months for motorists and businesses. This is the biggest ever cut to this tax, benefitting those who live in rural areas like the Borders the most.
30 million workers across the United Kingdom are also in line for a £330 tax cut from July. This will come from a £3000 uplift to the National Insurance Contributions threshold and is the biggest tax cut for a decade.
To help with direct support for the cost of living increases, the Scottish Government will receive £41 million in additional funding for Scots. We await to see how the SNP Government will use these extra resources.
In a change to VAT rules, energy saving materials such as insulation and heat pumps will be zero rated, meaning that it will now be cheaper to install these energy saving and environmentally friendly products in homes.
To support small businesses, the Employment Allowance will be increased, meaning that from April 670,000 small businesses across the UK will not pay NICs or Health and Social Care Levies.
Mr Sunak also announced the intention to cut the basic rate of income tax from 2024, which will provide the Scottish Government with £350 million to do the same in Scotland. Local politicians are calling on the SNP Government to commit to pass on this tax cut for workers in full.
John Lamont MP said:
“This is a bold and tax cutting Spring Statement from Rishi Sunak. This means more money in the pockets of workers, families and pensioners across Scotland to help with the rising cost of living.
“In places like the Borders, a car is a necessity for most. Lots of people have contacted me about cutting fuel duty and I am glad to see the Chancellor follow through on this with an instant cut. It is encouraging to see the UK Government prioritising those who live in rural areas.
“There is also more money for the Scottish Government to distribute as they see fit to help combat rising costs in energy.
“Alongside all of these measures, there is an ambitious Tax Plan from the Chancellor that will cut income tax in 2024. As this is a devolved tax in Scotland, the Scottish Government must commit to passing this on to hard working Scots, or run the risk of losing skills and investment to elsewhere in the UK.”
Rachael Hamilton MSP added:
“This UK Government’s Spring Statement delivers for the Borders and Scotland and with pressures on household incomes at the moment, it is a welcome relief.
“When it comes to National Insurance, 70% of workers will get an effective tax cut as the Chancellor raises the threshold for paying National Insurance by £3,000.
“I know this will be a welcome tax cut at a time when bills are soaring.
“The cut to fuel duty is also very welcome, especially across the Borders, as I know motorists are feeling the pinch of rising fuel costs at the pumps.
“The Scottish Government has been given more money to help tackle rising household energy bills, and I want to see them pass on every penny to help families.
“I will hold the SNP to account to make sure this UK Government money reaches those who need it most.
“The Conservative-led UK Government continues to deliver support to Borderers during these exceptional circumstances”.
