Autumn Statement: Chancellor confirms business rates relief but avoids VAT cut
Chancellor Jeremy Hunt extended business rates relief in the Autumn Statement today but made no mention of a cut in hospitality VAT.
He also confirmed that the National Living Wage for over-23s will increase from £9.50 an hour to £10.42 an hour from April 2023, which will mean an annual pay rise of over £1,600 for a full-time worker.
Business rates relief for those in the hospitality, retail and leisure sectors will continue for another year and rise from 50% to 75% for 2023-24, up to £110,000 per business.
The business rates multiplier is being frozen for another year and a £1.6b transitional relief scheme will be introduced to cap bill increases for the smallest properties to 5%.
Hospitality VAT is to remain at 20%, despite an ongoing campaign calling for it to be lowered, and there was no mention of the planned rise in alcohol duty.
There was also no confirmation on the future of energy bill support for businesses, but the government is due to publish a review by the end of the year.
Documents on the Treasury website state some support will remain for hard-hit businesses beyond March 2023, but the overall scale of help offered by the government will be lower.
Help with energy costs has been extended for consumer households, but at a less generous level. It means the bill for a typical household will rise to £3,000 in April, up from £2,500 now. Consumers are also set to have their incomes squeezed and the point at which the highest earners start paying the top rate of income tax will be lowered from £150,000 to £125,140.
The income tax personal allowance threshold will be frozen until 2028, meaning millions of people will end up paying more in tax. Employers' National Insurance contributions will also be frozen until April 2028.
A greater push for devolution is to bring elected mayors to Suffolk, Norfolk, Cornwall and an area in the north east of England which is yet to be confirmed.
The industry has reacted to today's news, with fears that some businesses will now be "facing collapse".
