Key points at a glance

Chancellor Rishi Sunak set out his 2022 Spring Statement in Parliament this lunchtime:

Inflation rises to 6.2% and fuel prices hit fresh record highs ahead of statement.

The UK has provided around £400m in economic and humanitarian aid for Ukraine. But actions taken to sanction Putin’s regime “not cost free,” Sunak warns.

Office for Budget Responsibility (OBR) says it is too soon to say what the exact impact of the war in Ukraine will be on the UK economy.

But the initial view is that the economy will grow by 3.8% this year. Then growth of 1.8% in 2023, and then 2.1%, 1.8% and 1.7% in the following three years.

The most “significant impact” will be on the cost of living, said Sunak.

Covid already meant goods and energy prices were high, but the OBR now predicts inflation will hit 7.4% by the end of the year.

Fuel duty to be cut by 5pence a litre, until March next year – the biggest cut to all fuel duty rates ever. It will take effect from 6pm tonight.

For the next five years, homeowners will pay 0% VAT on energy saving materials (solar panels/heat pumps)

Household support fund to be doubled to £1bn from next month.

Underlying debt expected to fall from 83.5% of GDP in the next financial year to 79.8% in 2026-27.

UK forecast to spend £83bn on debt interest in the next financial year.

National Insurance threshold raised by £3,000. From July people will not have to pay NI or income tax before earning £12,570.

Employment allowance increases to £5,000 – a tax cut worth up to £1,000 for 500,000 small businesses.

Basic rate of income tax cut to 19p in the pound – first time in 16 years the basic rate has been cut.

Government to cut tax rates on business investment – the details of which will be revealed in the autumn statement.

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