6 March 2024
If you are covering the latest news in financial markets, please find below a comment from Lindsay James, investment strategist at Quilter Investors:
“Ahead of today’s Spring Budget, it has been widely reported that a 2p cut in National Insurance is due to be announced at a cost of £10 billion, with cuts to income tax likely to be unaffordable. This would limit the scope of any further cuts given the estimated £13bn of headroom the Chancellor has to play with.
“While this cut would be welcome news to hard-pressed taxpayers, in the context of frozen tax thresholds and other planned tax rises in the years ahead in areas such as stamp duty land tax, the tax burden is still on track to exceed all-time highs. Meanwhile, public services continue to be a source of frustration for much of the electorate.
“A key area of focus today will be the updated OBR forecasts, particularly in light of the recent falls in both inflation and growth. With spending headroom having been created largely due to falling interest rates over the forecast period, this may be an early sign of light at the end of the tunnel. Whether this can come in time to limit electoral damage for the Conservatives remains to be seen, but with talk of a May election date, today’s budget seems unlikely to have much impact on existing polls even if, for now at least, there is a small benefit for our wallets.”
