Autumn Budget 2021
How does the Autumn Budget affect Northern Ireland businesses?
The Chancellor, Rishi Sunak, delivered his Autumn Budget and Spending Review statement on Wednesday 27 October 2021. We have summarised the key points from the Autumn Budget and specific issues affecting Northern Ireland businesses.
- 6.5% in 2021-22
- 6.0% in 2022-23
- 2.1% in 2023-24
- 1.3% in 2024-25
- 1.6% in 2025-26
- 85.2% of GDP in 2021-22
- 85.4% of GDP in 2022-23
- 85.7% of GDP in 2023-24
- 85.1% of GDP in 2024-25
- 83.3% of GDP in 2025-26
Northern Ireland-specific announcements
- The Northern Ireland Executive will receive an additional £1.6 billion in funding for 2021-22.
- The Northern Ireland Executive will also receive £1 billion to support farmers and land managers and £9.3 million to support fisheries.
- An additional £70 million funding for the British Business Bank to build on its existing programmes in Northern Ireland, working closely with local partners.
- A new trade and investment hub will be established in Belfast.
- The KickStart scheme will be extended in GB with the Northern Ireland Executive receiving additional funding through the Barnett formula to continue to the deliver JobStart scheme.
The Universal Credit taper rate will be permanently cut by 8% from 63p to 55p by 1 December 2021.
Minimum wage rates
From 1 April 2022, the National Living Wage will increase by 6.6% to £9.50 an hour. The National Minimum Wage rates will also increase:
- the rate for 21 to 22-year-olds by 9.8% from £8.36 to £9.18 per hour
- the rate for 18 to 20-year-olds by 4.1% from £6.56 to £6.83 per hour
- the rate for 16 to 17-year-olds by 4.1% from £4.62 to £4.81 per hour
- the rate for apprentices by 11.9% from £4.30 to £4.81 per hour
- the accommodation offset rate by 4.1% from £8.36 to £8.70 per hour
Air Passenger Duty
There will be a 50% cut in Air Passenger Duty delivered through a new domestic band set at £6.50 from April 2023 for flights between airports in England, Scotland, Wales and Northern Ireland.
Fuel duty rates will be frozen for the 12th consecutive year.
Planned rise on alcohol duty on spirits, wine, cider and beer cancelled. The alcohol duty system will be overhauled to make it fairer and more straightforward, with drinks taxed in proportion to their alcohol content and duty rules simplified.
A new relief will be introduced with duty rates on draft beer and cider cut to 5%.
Vehicle excise duty
Vehicle excise duty for heavy goods vehicles will be frozen. The heavy goods vehicle road user levy will be suspended until August 2022.
Second-hand VAT margin scheme
The government will legislate, should a relevant agreement be reached with the EU, to extend the VAT margin scheme to apply in Northern Ireland on a limited basis in respect of motor vehicles sourced from Great Britain for the period until the Second-hand Motor Vehicle Export Refund Scheme is implemented. As a result, motor vehicles first registered in the United Kingdom prior to 1 January 2021 will be available to sell under the VAT margin scheme in Northern Ireland during that time period.
Research & development
The government will increase investment in UK R&D to £20 billion by 2024-25. There are plans to reform R&D tax reliefs to support modern research methods.
Early years childcare providers
An additional £170 million of funding will be provided in 2024-25 to increase the hourly rate to be paid to early years providers to deliver the government's free childcare hours.
Tax relief for theatres, museums, orchestras and galleries
The headline rates of tax relief for theatres, museums, orchestras and galleries will be temporarily increased across the UK from 27 October 2021 to 31 March 2024. This will increase the relief organisations can claim as they invest in new productions and exhibitions.
First published 28 October 2021