Budget 2017: Summary
Posted on 22 November 2017 by
The Chancellor Philip Hammond today stood in the House of Commons today, turned to the Speaker and said:
"Mr Deputy Speaker. I want to turn to the challenge of the Housing Market... House prices are increasingly out of reach for many. It takes too long to save for a deposit. And rents absorb too high a portion of monthly income. So the number of 25-34 year olds owning their own home has dropped from 59% to just 38% over the last thirteen years.
"Put simply, successive governments over decades, have failed to build enough homes to deliver the home-owning dream that this country has always been proud of.
"The Prime Minister made a pledge to Britain's younger generation that she would dedicate her premiership to fixing this problem. Today we take the next steps to delivering on that pledge. By choosing to build."
Below, we summarise the key highlights from Phillip Hammond's 2017 Budget announcement:
- The Government has abolished the stamp duty land tax on all homes under £300,000 for first-time buyers with immediate effect (22 November).
- 95% of first-time buyers who pay stamp duty will benefit from this change.
- First-time buyers of homes worth between £300,000 and £500,000 will not pay stamp duty on the first £300,000.
- They will pay the normal rates of stamp duty on the price above that. This will save £1,660 on the average first-time buyer property.
- 80% of people buying their first home will pay no stamp duty at all under the change.
- There will be no relief for first time buyers buying properties worth more than £500,000.
- The target of 300,000 new homes a year hasn't been achieved since the 1970s.
- The Chancellor announced £15.3 billion in new financial support for house building over the next five years.
- This takes the total amount being invested to at least £44 billion.
- This figure includes £1.2 billion for the government to buy land to build more homes, and £2.7 billion for infrastructure that will support housing.
- The government will also create five new 'garden' towns.Changes to the planning system will encourage better use of land in cities and towns.
- This means more homes can be built while protecting the green belt.
Other Housing Announcements
- Government will give local authorities the ability to crack down on empty properties by charging a 100% council tax premium
- £28m for Kensington and Chelsea council to provide counselling services and mental health support for victims of the Grenfell fire and for regeneration of surrounding area
- New homelessness task force with £28m to fund three new housing pilots - in the West Midlands, Manchester and Liverpool. The ultimate aim is half rough-sleeping by 2022 and eradicate in by 2027.
- Tax-free personal allowance will rise to £11,850 in April 2018
- Higher-rate tax threshold to increase to £46,350 in April 2018
- Short-haul air passenger duty rates and long-haul economy rates to be frozen, paid for by an increase on premium-class tickets and on private jets
- The VAT (value-added-tax) threshold for small business will remain at £85,000 for two years
- There will be a £500m investment for 5G mobile networks, fibre broadband and artificial intelligence
- £540m to support the growth of electric cars, including more charging points
- A further £2.3bn allocated for investment in research and development
- Rises in business rates to be pegged to CPI (consumer price index) measure of inflation, not RPI (retail price index)
Other Key Points:
- The Chancellor announced that £3bn will be set aside over next two years to prepare the UK for every possible outcome as it leaves EU.
- Annual borrowing £49.9bn this year, £8.4bn lower than forecast in March.
- Borrowing forecast to fall in every subsequent year from £39.5bn in 2018-19 to £25.6bn in 2022-23.
- Duty on beer, wine, spirits and most ciders will be frozen.
- Vehicle excise duty for diesel cars that do not meet latest standards to rise by one band in April 2018. This tax hike will not apply to van owners. Existing diesel supplement in company car tax to rise by 1%. All the proceeds from this will be used to fund a new £220m clean air fund.
To speak with our experts call us now on 0344 346 3672 or submit an enquiry here
The blog postings on this site solely reflect the personal views of the authors and do not necessarily represent the views, positions, strategies or opinions of John Charcol. All comments are made in good faith, and John Charcol will not accept liability for them.