Autumn Statement 2016 key points

Philip Hammond has carried out his first Autumn Statement as chancellor. Below are the key points.

Public borrowing/deficit/spending

• Government finances forecast to be £122bn worse off in the period until 2021 than forecast in March’s Budget
• Debt will climb from 84.2% of GDP last year to 87.3% this year, peaking at 90.2% in 2017-18
• Office for Budget Responsibility (OBR) forecasts borrowing of £68.2bn this year, then £59bn in 2017-18, £46.5bn in 2018-19, £21.9bn in 2019-20 and £20.7bn in 2020-21
• Public spending this year to be 40% of GDP – down from 45% in 2010

The state of the economy

• OBR growth forecast upgraded to 2.1% in 2016 – from 2.0% — then downgraded to 1.4% in 2017, from 2.2%
• Forecast growth of 1.7% in 2018, 2.1% in 2019 and 2020 and 2% in 2021.
• Government no longer seeking a budget surplus in 2019-20 — committed to returning public finances to balance “as soon as practicable”

Taxation/pay

• Income tax threshold to be raised to £11,500 in April (£11,000 now)
• Higher rate income tax threshold to rise to £50,000 by the end of the Parliament
• Tax savings on salary sacrifice and benefits in kind to be stopped, with exceptions for ultra-low emission cars, pensions, childcare and cycling
• National Living Wage to rise to £7.50 an hour (£7.20 now) from April next year
• Employee and employer National Insurance thresholds to be equalised at £157 per week from April 2017
• Insurance premium tax to rise to 12% next June (10% now)
• Corporation tax to fall to 17% by 2020

Housing

• Ban on upfront fees charged by letting agents in England “as soon as possible”
• £2.3bn housing infrastructure fund to help provide 100,000 new homes in high-demand areas
• £1.4bn to deliver 40,000 extra affordable homes