SPRING BUDGET 2024: HOW DOES THE CHANCELLORS BUDGET AFFECT YOUNG SCOTS
Kiera Milne
08/03/24
(Jeremy Hunt, Picture Credit: Getty Images)
Yesterday afternoon, British Chancellor Jeremy Hunt announced the government’s 2024 spring budget to the House of Commons.
In what is final budget before the next UK General Election, Hunt laid out his tax and spending plans in front of MP’s at Westminster.
Despite Holyrood’s devolved powers, the announcement will affect Scots. In yesterday’s budget the Chancellor of the Exchequer announced different tax cuts, alongside duty freezes and national insurance cuts, which all affect young Scots.
National Insurance Cuts
This Yesterday afternoon, Jeremy Hunt announced to the House of Commons, that national insurance will be cut by 2p, in an attempt to boost conversative poll ratings and to reboot the British economy out of a recession.
This means that earners will now pay 8% of their taxable salary on national insurance contributions, which is down from 12%.
So how does this affect you?
Plans for a 2p cut to national insurance was part of Hunt’s announcement. This means that earners will now pay 8% of their taxable income rather than 12% on national insurance contributions.
National insurance is a tax on earnings, which you normally start to pay when you turn 16 and earn over a certain amount. Your national insurance contributions decide if you can qualify for certain benefits, such as state pension and Jobseeker’s allowance.
Here’s how this may affect you:
New Vape Tax
Hunt also announced that Westminster will introduce an ‘excise duty’ on vape products from October 1st 2026. As a result, the prices of vapes will increase.
tobacco duty will also increase to ensure that vaping remains cheaper than smoking cigarettes. During the announcement, the Chancellor stated, “because vaping can also play a positive role in helping people to quit smoking, we’ll increase a non-off increase of tobacco duty at the same time to maintain a financial incentive to choose vaping over smoking”.
This tax will heavily affect young Scots because in January last year, it was found that were was an average of 543,000 vapers across Scotland.
Extension of the fuel duty freeze
The fuel duty freeze was a temporary cut introduced by Rishi Sunak in 2022. After already being extended in March 2023, yesterday Hunt announced a further 12-month extension. This means the 5p per litre fuel duty cut will continue, saving the average car user around £50 a year.
Alcohol duty freeze
In the Autumn statement delivered by the Chancellor of the Exchequer, a six month freeze for alcohol duty was announced. This was set to end in August 2024,however this will not rise until February 1st 2025.
This announcement is set to benefit 38,000 pubs throughout the UK, costs would be cut for breweries, distillers and restaurants, as well as nightclubs, bars and pubs. During the session Hunt said, “we’re backing the Great British pub!” This will allow an average saving of £13,000 for a standard pub.
However, this cut/freeze has received mixed opinions with Whiskey 1901 and CEO Aaron Damiano Sparkes stating the current system “still discriminates between alcohol beverage categories with consumers who drink 14 units of cider a week being taxed £1.23 versus those who drink Scotch being taxed £4.42”
“This contradicts the UK Government’s pledge to support Scottish whisky- an industry that contributes £7.1 billion in exports to the UK economy and supports more than 66,000 jobs across the UK” Sparkes told GB news.
“Scottish distilleries are popular tourist attractions and generate crucial income for other businesses in their local communities”, Sparkes said.
The Alcohol duty freeze is already having a detrimental effect on the Scottish Whiskey industry, which is one of Scotland’s biggest exports, contributing £5.3 bn to the Scottish economy in 2022.
For more information about this budget, visit: https://www.gov.uk/government/publications/spring-budget-2024/spring-budget-2024-html