Other Measures

Energy costs

The Chancellor began his speech with what he described as the issue most worrying the British people – the cost of energy. He did not announce any new measures, but summarised the support that has already been announced: the Energy Bills Support Scheme, which will provide a £400 nonrepayable discount to eligible households to help with their energy bills over the coming winter, and a new Energy Price Guarantee, which will reduce the unit cost of electricity and gas so that a typical household in Great Britain pays, on average, around £2,500 a year on their energy bill, for the next 2 years, from 1 October 2022. The Energy Price Guarantee limits the amount a customer can be charged per unit of gas or electricity, so the exact bill amount will continue to be influenced by how much energy the consumer uses.

There are further measures to support businesses, and different arrangements for people on different types of energy supply contracts. The Chancellor noted that the volatility of the energy market meant that it was not possible to be sure of the cost to the government of this support, but it is estimated to be £60 billion over the next six months.

Investment Zones

The Chancellor announced the introduction of Investment Zones. These will be located throughout the UK in cooperation with the devolved administrations and local authorities. The intention is that Investment Zones will have more liberal planning regulations and significant tax incentives for businesses for ten years: accelerated capital allowances for buildings and plant, no Stamp Duty Land Tax on purchases of land and buildings for commercial or new residential development, no business rates on newly occupied commercial premises, and relief from employer’s NIC on the first £50,270 paid to a newly hired employee.

The documents published following the Chancellor’s statement included a list of possible sites for Investment Zones and 38 councils and authorities with which the government is in preliminary discussion about locating a Zone in their area.

Office of Tax Simplification

The Office of Tax Simplification (OTS) was established as an independent body by the incoming coalition government in 2010 to identify areas where complexities in the tax system for both businesses and individual taxpayers could be reduced, and then to publish their findings for the Chancellor to consider ahead of his budget. The Chancellor expressed thanks for the work of the OTS over the last 12 years, but said he had decided that it was necessary to ‘embed tax simplification into the heart of Government’. Accordingly, the independent OTS will be wound down, and every tax official will be ‘mandated to focus on simplification of the tax code’.

Deregulation

The Chancellor announced an intention to remove unnecessary costs for business. This will include the so-called ‘sunsetting’ of EU regulations by December 2023, requiring government departments to review, replace or repeal EU laws retained after Brexit.

As widely predicted, the Chancellor announced the removal of the cap on bankers’ bonuses, introduced by the EU in 2014 in a response to what was seen as excessive risk-taking that may have contributed to the financial crisis of 2007/08.

The Growth Plan also includes a promise of new legislation intended to remove planning barriers to infrastructure projects, including reducing the burden of environmental assessments, reducing bureaucracy in the consultation process and reforming habitats and species regulations. An appendix to the Plan lists 138 infrastructure projects which the Chancellor hopes will be accelerated by these changes.

Alcohol duties

In the Autumn 2021 Budget, Rishi Sunak announced a review of the whole scheme of alcohol duties. The government has now published its response to the consultation on reform and proposed legislation for comment. It is intended that the reforms will be implemented from 1 August 2023. In the meantime, alcohol duty rates will be frozen from 1 February 2023 to provide additional support for the sector.

Universal Credit

The Chancellor noted that unemployment is at the lowest level for fifty years. However, there are more vacancies than unemployed people to fill them, so he sees the need to encourage people to join the labour market. This will be achieved by reducing people’s benefits if they fail to fulfil their job search commitments and by providing more help to the unemployed over-50s. These changes ‘will give claimants the best possible chance to be financially independent of Universal Credit’.