There was a lot to take in with the chancellor’s Autumn Statement, with every aspect of the economy affected by planned revisions to tax, energy, business rates and more.
But what do the announcements for 2023 entail for independent retailers? Here Bira chief executive Andrew Goodacre summarises the key facts and figures in each area relevant indie retailers…
(Please note this applies to England. Devolved countries set their own business rates)
- Multiplier frozen for 12 months. Normally the multiplier is increased in line with inflation, which would have been 10.1 per cent this year.
- The current retail discount is 50 per cent, next year it will be increased to 75 per cent. This is a discount applied per businesses with rateable values below £110,000.
- ‘Downwards transitional relief’ has been removed next year. This change means that any reduction in rateable values from the current review will be passed on to businesses immediately.
- Revised support for consumers announced with a higher cap as from April 2023 (increasing average energy bill to £3,000 per annum)
- There was no announcement regarding the support for businesses. There is currently a review taking place to assess which businesses will receive support after march 2023 and the result of that review is due in six weeks’ time
- The rate at which corporation tax is charged is scheduled to increase from 1 April 2023. The rate will increase to 25 per cent for companies whose taxable profits exceed £250,000. For companies with profits of less than £50,000, the current 19 per cent rate will still apply. Companies with taxable profits between £50,000 and £250,000 will pay tax at the 25 per cent rate reduced by a marginal relief such that overall they will pay on a sliding scale between 19 per cent and 25 per cent.
- No changes to VAT
- The Chancellor said that, despite economic pressures, the UK Government is committed to the UNCOP26 Glasgow Climate Pact including the 68 per cent reduction in emissions by 2030. Jeremy Hunt will double the spending on the energy efficiency of homes, business and the public services by £6 billion from 2025 until 2028 – in addition to the previous £6.6 billion previously announced. A new Energy Efficiency Taskforce will be set up and charged with delivering energy efficiency improvements across the economy.
- National Insurance: The Employers NICs secondary threshold will be frozen at £9,100 until April 2028. The Employment Allowance will also be kept at its new higher level of £5,000.
- National Minimum Wage: rates increase from 1 April 2023 as follows:
- 9.7 per cent increase for people aged 23 and over from £9.50 to £10.42 per over
- 10.9 per cent increase in 21-22 year old rate from £9.18 to £10.18 per hour.
- 9.7 per cent increase in 18-20 year old rate from £6.83 to £7.49 per hour.
- 9.7 per cent increase in 16-17 year old rate from £4.81 to £5.28 per hour.
- 9.7 per cent increase in the apprentice rate from £4.81 to £5.28 per hour.
- Daily Accommodation Offset: 4.6 per cent increase from £8.70 to £9.10.
Regional & local government
- Investment Zones: these new zones announced on 23 September will be kept, centered on universities in “left behind areas” to help build growth clusters, with further announcements due in the next Budget.
- Levelling Up: plans for a second round of the Levelling Up Fund were confirmed, with £1.7 billion to be given to prioritised local infrastructure projects before the end of the year. A new Mayor will be elected in Suffolk as part of a devolution deal with Suffolk County Council. Whitehall in advanced discussions on mayoral devolution deals with other local authorities in Cornwall, Norfolk and the North-Eastern England.
Prime minister Rishi Sunak is giving extra money to the Devolved Administrations through the Barnett formula:
- £1.5 billion for the Scottish Government.
- £1.2 billion for the Welsh Government.
- £650 million for the Northern Ireland Executive
If you find this information useful, Bira would like to hear from you. Have your say on the Autumn Statement by completing its short survey.