‘As we start our negotiations to exit the European Union, this Budget takes forward our plan to prepare Britain for a brighter future ‘. – Philip Hammond
The UK Finance Minister Philip Hammond presented his annual budget statement for the 2017-18 fiscal year on Wednesday. According to the latest projections, the British economy is likely to expand 2% in 2017, compared to a previous estimate of 1.4%. Nevertheless, during the next year economic growth is expected to fall to 1.6% and then climb to 1.7% and 1.9% in 2019 and 2020, respectively. Hammond also said that a return to a 2% growth rate is expected in 2021. Meanwhile, inflation is seen hitting 2.4% in 2017, before slowing to 2.3% in 2018. Inflation is expected to return to the Bank of England’s target rate of 2% in 2019. Net borrowing in the public sector is predicted to drop to 2.6% in 2016-2017, compared with 3.8% in 2015-2016, and rebound to 2.9% in 2017-2018. However, Hammond highlighted that it would probably decline to 1.9% in 2018-2019 and hit 0.7% in 2021-2022. He also said that the personal allowance would increase to 11,500 pounds, as well as the higher rate of income tax threshold would rise to 45,000 pounds. For small businesses the tax-free dividend allowance would decline to 2,000 pounds. Furthermore, the government would give a 1,000 pound discount on business rate bills for all pubs with rateable value up to 100,000 pounds in 2017.
