UK Spring Budget 2024 – Fundhouse Comment

Chris Proudfoot - Fundhouse

Home » UK Spring Budget 2024 – Fundhouse Comment

Published: 6th March 2024

This Article was Written by: Chris Proudfoot - Fundhouse


Chancellor Hunt unveiled this year’s Budget on Wednesday in the House of Commons.


Since the next UK general election is likely to take place this year, the Budget was unsurprisingly political, with criticisms of Labour policies provided alongside the delivery of his own. He began with some economic commentary, claiming that growth in the UK has been higher than all other large European nations since 2010. Looking forward, we learnt that the OBR expect the economy to grow by 0.8% this year and 1.9% next year, 0.5% higher than the forecast last autumn. In addition, Hunt commented on inflation, noting that it had fallen from 11% at the start of Sunak’s premiership to 4% currently, with the government having delivered on the PM’s goal of halving inflation in 2023.

Policy highlights

Implications for individuals

  • Tax Relief and Income Support: National Insurance (NI) will be reduced by 2p in the pound for both employees and the self-employed. Additionally, the extension of full child benefits to households earning up to £60,000 aims to provide greater financial security for families.
  • Duty freeze and tobacco tax: Alcohol duty and fuel duty to be frozen for another year, while air passenger duty for business class flights is set to increase. The existing tax on tobacco will increase, with a new tax on vaping products to start in October 2026.
  • Savings and Debt Management: The introduction of a £5,000 “British ISA” tax allowance incentivises individual savers to invest in UK-listed companies. Measures such as longer repayment periods for emergency budgeting loans and scrapping the £90 fee for debt relief alleviate financial burdens for those in need.
  • Cost of Living Support: The extension by six months of the government fund to assist individuals grappling with cost-of-living pressures offers temporary relief.
  • Property: The higher rate of tax paid on profits from the sale of property to fall to 24% from 28%. Tax breaks for owners of holiday let properties to be scrapped.

Implications for businesses/national economy

  • Taxation and Business Operations: The rise in the VAT registration threshold from £85,000 to £90,000 reduces administrative burdens for small businesses, promoting entrepreneurship and growth. Additionally, tax reliefs for touring and orchestral productions provide stability and support for cultural industries.
  • Energy and Infrastructure: The government has committed to purchasing the site of the planned Wylfa nuclear plant in north Wales. The “windfall” tax on energy firms has been extended to 2029.


In addition to the ‘British ISA’ carrot for individual investors, the chancellor hinted that he may introduce a stick to force pension schemes to invest in UK companies. The intention is clear, to improve the capital flow to UK Plc, however, it is unclear what impact either policy would have in practice. The cut in NI should translate to increased take-home pay, thereby bolstering consumer spending. Generally speaking, the majority of measures maintained or introduced were overwhelmingly supportive to economic activity, which is unsurprising in an election year. Since we are ‘overweight’ UK, one could view the Budget as beneficial to our portfolios, however, the extent to which the policies will ‘move the dial’ is unclear. Additionally, there is uncertainty around the degree to which they will be maintained by an incoming government. More importantly, and as a reminder, we do not invest based on short-term economic or political news, and instead look for investments with the most attractive long-term valuations.

Fundhouse is the trading name of Fundhouse Bespoke Limited. Fundhouse provides investment management services to professional clients and does not provide financial advice. Importantly, this note does not represent investment advice and any reader should always speak to their financial adviser before making any investment decisions. Please note that the value of any investment may go down as well as up and you may lose capital when investing and the value of your investments may not always increase. Please ensure that you are comfortable bearing financial losses and that you are comfortable taking a long-term investment view of five years or more.

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