Money Box Money Box Live: Budget Breakdown
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Nov 27, 2024 Dr. Arun Advani, Professor of Economics at the University of Warwick, provides expert insights on the recent budget announcement. He discusses a monumental £40 billion tax increase affecting personal finances, including significant changes to inheritance tax and national insurance. The conversation includes implications for small businesses, particularly in hospitality, and examines the surprise cuts in alcohol duty, particularly for draft beer. Advani also tackles how these financial changes intertwine with government support for low-income households amidst growing economic pressures.
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Balancing Tax Increases and Spending Power
- The Chancellor aimed to raise taxes by £40 billion while increasing people's spending power.
- She sought to align the tax system with her manifesto, focusing on raising employer national insurance contributions.
Retirement Worries
- Lisa and Hilda, nearing retirement, expressed concern about the budget's potential impact.
- They worried about increased taxes, working longer, and diminished retirement enjoyment.
Inheritance Tax Impact
- Inheritance tax, while impacting a small percentage of estates, remains unpopular.
- Freezing the inheritance tax threshold at £1 million until 2030 might increase the number of affected estates due to fiscal drag.