A summary of the UK budget from UK Chancellor Hunt

<ul><li>UK Chancellor Hunt announced plans to reduce debt and cut taxes, with the Office for Budget Responsibility (OBR) assessing that these measures will lower inflation and boost GDP.</li><li>The Chancellor intends to reduce business taxes.</li><li>Welfare benefits will be increased by 6.7%, aligning with expectations.</li><li>There will be increased support for housing costs through the local housing allowance.</li><li><span>UK Chancellor Hunt has announced a freeze on all alcohol duties until August 1st, 2024</span></li><li><span>TO increase pension allowance by the full triple lock commitment of 8.5%</span></li><li><span>The headline debt is expected at 94% of GDP by&nbsp;the end of the forecast horizon (FY 27/28)</span></li><li><span>To create new simplified R&amp;D tax relief</span></li><li>Will sell NatWest shares back to retail investors</li><li>UK to extend 75% business rated discount for retail, hospital and leisure.&nbsp;&nbsp;</li><li>To make full expensing tax breaks for business will be made permanent</li><li>Reduces the main 12% rate of employee national insurance to 10% (to same $450 per average worker.)&nbsp;</li><li>The UK's Office for Budget Responsibility (OBR) confirms that the target of Public Sector Net Borrowing (PSNB) below 3% in the 2028/29 reference period has been achieved.</li><li>The fiscal headroom is noted at GBP 13 billion, which is significantly lower than the post-2010 average of GBP 29.7 billion typically available to Chancellors.</li><li>The medium-term fiscal outlook has seen a considerable improvement compared to the situation in March 2023.</li><li>The fiscal headroom of GBP 13 billion is largely attributed to the rolling nature of the budget rule, which provides an additional year.</li><li>The tax burden is projected to increase annually, reaching a post-war high of 37.7% by the fiscal year 2028-29.</li></ul><p>UK OBR Forecasts for CPI (Consumer Price Index) Year-over-Year:</p><ul><li><strong>2023:</strong> Expected at 7.4%, with a March 2023 estimate of 6.1%.</li><li><strong>2024:</strong> Forecast at 2.8%, compared to an expected 3.0% and a March 2023 estimate of 0.9%.</li><li><strong>2025:</strong> Projected at 2.0%, aligning with an expected 2.0% and a March 2023 figure of 0.1%.</li><li><strong>2026:</strong> Expected at 2.0%, with a March 2023 estimate of 0.5%.</li><li><strong>2027:</strong> Anticipated at 2.1%, with a March 2023 estimate of 1.6%</li></ul><p>UK OBR Forecasts for GDP Growth:</p><ul><li><strong>2023:</strong> Projected at 0.6%, compared to an expected 0.4% and a March 2023 forecast of -0.2%.</li><li><strong>2024:</strong> Estimated at 0.7%, against an expectation of 0.4% and a March 2023 forecast of 1.8%.</li><li><strong>2025:</strong> Forecast at 1.4%, closely aligning with an expected 1.3% and a March 2023 prediction of 2.5%.</li><li><strong>2026:</strong> Anticipated at 1.9%, compared to an expected 1.7% and a March 2023 forecast of 2.1%.</li><li><strong>2027:</strong> Projected at 2.0%, against an expectation of 1.6% and a March 2023 estimate of 1.9%.</li><li><strong>2028:</strong> Forecast at 1.7%</li></ul>

This article was written by Greg Michalowski at www.forexlive.com.