Budget 2024 LIVE: Chancellor Jeremy Hunt plans 2p National Insurance cut as he defies calls to reduce income tax

The Chancellor is bound by his self-imposed fiscal rules, which include having national debt as a share of gross domestic product (GDP) falling by the end of a five-year period.

The gap between his tax and spending plans and the limits set by this rule is known as the headroom.

As well as potentially eating into this headroom – leaving less of a buffer to cope with unexpected events – Mr Hunt is likely to tinker with a few taxes to raise some extra cash.

The non-dom tax status for wealthy overseas individuals could be changed or scrapped and a levy on vapes could also help fill the Treasury coffers.

But the big prize for Mr Hunt would be economic growth – as well as generating extra tax income, an increase in GDP changes the balance when it comes to calculating the headroom available for meeting his fiscal rule.

Here’s the scene outside Chancellor Jeremy Hunt’s official residence at 11 Downing Street in London this morning ahead of him announcing the Budget later on:

Here’s a video of Chancellor Jeremy Hunt going for a run near Downing Street today with his dog Poppy ahead of the Budget:

Scotland’s Deputy First Minister has urged the Chancellor to increase funding for capital projects in his spring Budget.

Shona Robison – who also controls the purse strings in Scotland – has been criticised for a more than £200million cut in funding for housing in the recently-passed Scottish budget. But she said in January that housing would be the ‘number one priority’.

Today, she said: ‘Today the Chancellor must not repeat the mistakes of the autumn statement – where £27 billion of fiscal headroom was used to fund tax cuts – and instead prioritise the investment needed for Scotland’s people and public services.’

if extra funding is provided from Westminster following the Budget.

Conservative MP Harriett Baldwin has told LBC News this morning that she is ‘on standby’ for an election as soon as May.

The Chairwoman for the Treasury Select Committee said the Prime Minister has said elections will likely be held off until later in the year, but that May is a possibility.

Watch a video of her comments here:

Jeremy Hunt is poised to unveil a 2p national insurance cut today as he lays out the Tory pitch to Britain.

In a crucial pre-election Budget, the Chancellor is expected to offer relief to 27million workers – typically worth £900 a year.

Here’s the latest story from MailOnline’s political editor James Tapsfield, which has just been posted:

BBC chief political correspondent Henry Zeffman has tweeted that Larry the cat has ‘stolen my space’ outside Downing Street this morning.

The pet’s official title is ‘Chief Mouser to the Cabinet Office’ and he has been in residence since February 2011.

The easement of wine duty will not be made permanent because this would go against reforms to the industry, a Treasury minister has said.

Gareth Davies said the Government’s reforms, which include calculating alcohol duty based on strength, have ‘simplified’ the system for businesses.

In August last year, the Government introduced temporary legislation which means all wine between 11.5 per cent and 14.5 per cent ABV is treated as if it is 12.5 per cent ABV, for the purposes of calculating duty.

This is expected to come to an end in February 2025, despite the Wine and Spirit Trade Association (WSTA) calling for it to be made permanent because ‘the long-term red tape burden is significant’.

Trade minister Greg Hands has backed scrapping the controversial ‘tourist tax’ in today’s Budget to give the economy a boost.

The former Conservative Party chairman said it would bring ‘benefits’ to the capital to reintroduce VAT-free shopping to foreign visitors.

He added his voice to those of hundreds of businesses who say the policy is harming the economy and benefiting cities like Paris where tourists do not have to pay the charge. Read the full story from the Daily Mail’s Whitehall editor Claire Ellicott:

Daily Mail cartoonist Jonathan Pugh has this drawing on the Budget in today’s newspaper:

Three-quarters of Tory activists want Jeremy Hunt to prioritise increased defence spending over tax cuts, a survey has revealed.

The study by grassroots website ConservativeHome found overwhelming support for the Chancellor boosting Britain’s defences in response to growing worldwide threats.

Read the full story from the Daily Mail’s political editor Jason Groves:

With polls suggesting Labour is on track to win the general election, Jeremy Hunt will use his Budget to set electoral dividing lines with Sir Keir Starmer’s party.

The Chancellor claimed that a Labour government would ‘destroy jobs with 70 new burdens on employers, reduce opportunities by halving new apprenticeships and risk family finances with new spending that pushes up tax’.

‘Instead of going back to square one, our plans mean more investment, more jobs, more productive public services and lower taxes, sticking to our plan in a Budget for long-term growth.’

Jeremy Hunt is making final preparations for his crucial pre-election Budget today as hopes mount that he could push through big tax cuts.

The Chancellor had an audience with the King at Buckingham Palace yesterday after finalising the package after months of wrangling.

There are signs that Mr Hunt will be able to unveil a move on personal taxes, regarded by many as essential for the Tories to have a chance of clawing back Labour’s massive poll advantage.

Read the full article from MailOnline’s political editor James Tapsfield and political correspondent Greg Heffer:

An SNP MP has accused the UK Government of leaving Scotland short-changed after analysis revealed the block grant will be the lowest since devolution.

Pete Wishart (pictured), the party’s longest-serving MP, has said the Scottish Government’s funding from Westminster would exacerbate the cost crisis facing households.

Analysis from the House of Commons Library suggests that Scotland’s block grant will consist of just 3.5 per cent of UK Government spending in 2023/24 and 2024/25, according to the Autumn Statement plans.

The research suggests it will be the first time the figure has dropped so low since the devolution settlement began. The previous low of 3.6 per cent was issued in 2014/15 and for three consecutive years from 2016/17.

But the UK Government said Scotland receives about 25 per cent more funding per person than equivalent spending in other parts of the UK.

Today’s Spring Budget has been the most leaked and briefed of all time, writes ALEX BRUMMER. The boldest measure – likely to be a further cut in National Insurance, after the two percentage point reduction in the Autumn Statement – looks nailed on.

Read the full analysis from the Mail’s City editor here:

Jeremy Hunt could shave more off his post-election public spending plans to fund giveaways, reducing overall departmental spending – currently pencilled in to rise by 1 per cent per year in real terms after 2025 – to 0.7 per cent.

Experts have warned of a possibly implausible spending squeeze after the election that could harm strained public services.

In a sign he could go down that path, Mr Hunt defended austerity, saying it was only because the Government ‘reduced the deficit’ that it could ‘generously’ help people during the pandemic.

Jeremy Hunt has said he will not pay for tax cuts with borrowing, meaning a combination of spending cuts and tax rises elsewhere will be necessary.

Tax rises could include a levy on vapes, a tax raid on owners of short-term holiday lets, and the scaling back of non-dom tax relief – a policy previously advocated by Labour and opposed by ministers.

Shadow health secretary Wes Streeting told Sky News that if the Tories steal the measure ‘we’ll have to look at other alternatives’ to fund Labour’s NHS spending plans ‘because we’ve already made those commitments’.

A possible extension of the energy windfall tax faced fierce opposition from Scottish Tory leader Douglas Ross, according to the Daily Telegraph.

The Resolution Foundation think tank said the biggest net beneficiaries of the national insurance cut, combined with threshold freezes, are those earning £50,000, while those earning £19,000 or less will actually be worse off.

Jeremy Hunt is poised to deliver long-awaited personal tax cuts when he presents his Budget today, but don’t be fooled by any grand measures — your tax bill is still likely to be bigger than ever.

Read Jessica Beard’s analysis in this article for Mail+. If you’re not already subscribed, you can click on the article then follow the instructions to enjoy your first month for free.

Experts said that a 2p reduction in national insurance contributions would not by itself be enough to stop the tax burden reaching record levels by the end of this decade.

The Institute for Fiscal Studies said the measure would not prevent taxes rising to about 37 per cent of GDP by 2028-29.

Shadow chancellor Rachel Reeves said Labour is ‘now the party of economic responsibility’ as she accused the Tories of overseeing ‘fourteen years of economic failure’.

She said: ‘The Conservatives promised to fix the nation’s roof, but instead they have smashed the windows, kicked the door in and are now burning the house down.

‘Taxes are rising, prices are still going up in the shops and we have been hit by recession. Nothing the Chancellor says or does can undo the economic vandalism of the Conservatives over the past decade.’

Labour also said any reductions would be cancelled out by the Government’s continued freeze on tax thresholds, meaning more people are dragged into a higher band as their pay increases.

Britons have revealed their concerns over inheritance tax, childcare costs, electric car costs and the housing market as Jeremy Hunt prepares to reveal his Budget.

As he aims to set dividing lines with Labour ahead of the general election later this year, MailOnline has spoken to more than 20 households about their finances:

A series of photographs were released by the Treasury last night of Chancellor Jeremy Hunt preparing for the Budget in his office at 11 Downing Street.

In comments ahead of his Budget, Mr Hunt said: ‘Because of the progress we’ve made because we are delivering on the Prime Minister’s economic priorities we can now help families with permanent cuts in taxation.

‘We do this not just to give help where it is needed in challenging times. But because Conservatives know lower tax means higher growth. And higher growth means more opportunity and more prosperity.’

He added that growth ‘cannot come from unlimited migration’, but ‘can only come by building a high-wage, high-skill economy’.

Two former home secretaries have criticised the plans for Jeremy Hunt’s Budget.

Suella Braverman said ‘my preference would be 2p off the basic rate of income tax’, while Dame Priti Patel has called for the unfreezing of income tax thresholds.

Chancellor Jeremy Hunt has been pictured this morning going for a run with his dog Poppy near Downing Street in London ahead of the Budget:

Jeremy Hunt was widely reported to have defied calls from some in Downing Street and many Conservative MPs to reduce income tax, which is more expensive but better understood by many voters.

They were concerned another National Insurance reduction would not be enough to boost Prime Minister Rishi Sunak’s party’s dire poll ratings, after the last one failed to move the dial.

But Mr Hunt was said to have taken the decision to cut National Insurance after fiscal watchdog the Office for Budget Responsibility downgraded the amount of fiscal headroom available for delivering tax cuts or spending commitments, within the Chancellor’s self-imposed rule of having debt falling as a share of gross domestic product (GDP) by 2029.

An income tax cut, previously promised by Mr Sunak, could reportedly still feature in a fiscal event later this year or in the Conservative election manifesto.

Let’s start with a look at the top Budget story on MailOnline today, which is that Jeremy Hunt will slash National Insurance by another 2p today in a tax-cutting drive ahead of the next election.

Whitehall sources told the Daily Mail that the Chancellor will press ahead with a second consecutive 2p cut in personal tax today, leaving the average worker £900 a year better off.

Read the full story from the Daily Mail’s political editor Jason Groves here:

Good morning and welcome to MailOnline’s live coverage of the Budget today.

Jeremy Hunt is expected to make a 2p cut to national insurance central to his Budget, which he said would deliver ‘more opportunity and more prosperity’.

The Chancellor promised ‘permanent cuts in taxation’ that would bring ‘higher growth’ as he seeks to woo voters ahead of this year’s general election.

He looks likely to announce a cut in national insurance by a further two percentage points later today, matching a cut in the Autumn Statement.