Spring Finance Bill published to cut tax for working families
Spring Finance Bill published to cut tax for working families and boost creative sector
- The Spring Finance Bill has been published today, enshrining landmark tax changes that back British families and support key growth industries.
- Bill to introduce the raising of the High Income Child Benefit Charge threshold from £50,000 to £60,000.
- Creative sector to receive £1 billion in tax relief support as part of the Bill’s measures.
Following last week’s Budget for long-term growth, the Spring Budget Bill 2024 has been published today (Thursday 14 March 2024) to enshrine a raft of landmark tax changes into law.
Measures in the Bill include backing hard-working British families by increasing the threshold for the High Income Child Benefit Charge (HICBC) from £50,000 to £60,000, taking 170,000 families out of paying this tax charge altogether.
This follows the passing of the separate National Insurance Bill in the House of Commons on 13 March 2024, which outlines the planned 2p cut for employees and the self-employed to be implemented on 6 April 2024. This builds on the government’s ambition to end the unfairness of double taxation on work from income tax and National Insurance.
Financial Secretary to the Treasury, Nigel Huddleston, said:
Today’s Bill helps to build a stronger economy by rewarding hard work and celebrating ambition while providing families with the opportunities they need to succeed in life.
By supporting parents at home, this will help bring the equivalent of 10,000 full-time individuals back into the workforce, helping to grow our economy further.
Changes to the HICBC also include halving the rate at which is withdrawn meaning parents will only have to pay the full charge at £80,000. Taken together, these changes mean that 485,000 hard working families will gain an average of £1,260 a year towards raising their children in 2024-25.
The government also plans to end the unfairness for single earner families by basing HICBC on a household rather than individual basis by April 2026, with a consultation expected in due course.
These changes for working families build on the Chancellor’s plans to put over £900 a year back into the average worker’s pocket thanks to a National Insurance tax cut at Autumn Statement followed by another announced at Spring Budget. Taken together this drops the rate of National Insurance Contributions for 27 million working people from 10% to 8% in April.
The Bill will also help establish the UK as a world-leader in high-growth industries, including introducing new investment incentives for the creative sector with over £1 billion of additional tax breaks.
Ben Roberts, Chief Executive of the British Film Institute said:
The increased expenditure credit for UK films is a landmark moment for UK film, and the most significant policy intervention since the 1990s. The positive impact will be felt across our industry, and through all the new films that audiences will get to enjoy.
The films we make are vital to our culture expression and creativity - they reflect a diverse and global Britain, and build careers - and we’re grateful to Government, the DCMS, the industry and our friends at Pact for working together to realise this historic initiative.
This includes measures for a permanent 40% tax relief for non-touring productions for theatres, museums and galleries, and a 45% relief for touring and orchestral productions.
This is in addition to introducing a new UK Independent Film Tax Credit at a rate of 53%, a 40% relief on business rates bills for eligible film studios in England, as well as providing a 5% increase in tax credit for UK visual effects costs in film and high-end TV programmes.
This will help to fulfil the government’s ambition to the industry by £50 billion, supporting a million extra jobs and building a pipeline of talent and opportunity for young people by 2030.
As well as support for families and the creative sector, the Chancellor Jeremy Hunt announced other changes to deliver lower taxes and get the economy growing. These include:
- Cutting the higher rate of Capital Gains Tax on residential property from 28% to 24%, incentivising landlords and second homeowners to sell their properties and boost the housing market.
- Abolishing Multiple Dwellings Relief after an external evaluation showed no evidence this relief was meeting its original objectives to support investment.
- Legislating for a price floor for the Energy Profits Levy (EPL) to only remain in place while prices remain high, giving oil and gas companies certainty for the future.
Notes to editors
- A full list of measures included in today’s Spring Finance Bill 2024 can be found online
- The Bill also legislates for several tax changes which have been previously announced and consulted upon, including maintaining the current rates for income tax and corporation tax, and the Starting Rate for Savings.
- The changes to National Insurance, which will take effect on 6 April 2024 for employees and self-employed people, is being legislated through a separate Bill to the Spring Budget Bill 2024.