MHA | Can the Chancellor cut tax bills at the Autumn Statement 2023?
Scissors Cutting Through Paper

Can the Chancellor cut tax bills at the Autumn Statement 2023?

Patrick King · October 20th 2023 · read

Jeremy Hunt is facing a major financial headache as he contemplates what to do, firstly in the forthcoming Autumn Statement due on Wednesday 22 November, and secondly for the Budget due next Spring. Hanging over his decisions in both is the veritable Sword of Damocles that is the looming general election, which will almost certainly take place during 2024.

Although the UK tax burden is the highest it has been post-WW2, the succession of financial shocks the UK and the World have suffered over the last few years, most recently Covid, the war in Ukraine, and now the dreadful events in and around Gaza, have resulted in an uncommonly hostile financial environment for the Chancellor.

On one hand Mr Hunt appears to have up to £11bn of headroom to fund tax cuts due to borrowing in the year to July being lower than the OBR forecast. On the other hand however, increased interest costs, the massive increase in pension bills caused by the triple lock, a health service under pressure like never before and an economy which at best could be described as “sluggish” suggest this amount and more will probably be swallowed up even if there are no tax cuts.

Steady as she goes” may be an option for a time as the UK has (so far) avoided a recession and inflation is falling, (albeit slower than hoped), but a bold plan to incentivise investment and aggressively seek increased productivity must surely be needed very soon.

Patrick King, Tax Partner

For insights on potential measures from the Chancellor in his Autumn Statement, view our full wishlist article

For further guidance

For further guidance on any of the tax measures discussed in this article, please contact your usual MHA advisor or contact us

Find the latest Autumn Statement 2023 commentary on our dedicated hub, where we will be providing resources, advice and practical guidance on what any tax measures announced could mean for you and your business, and to help you prepare for and manage their impact.

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