Budget 2024: When is it and what will it mean for my money?

There has been a lot of speculation about whether he will announce tax cuts ahead of the next general election.

What is the Budget?

Each year, the chancellor of the exchequer - who is in charge of the government's finances - makes a Budget statement in the House of Commons.

This outlines the government's plans for raising or lowering taxes and sets out its spending commitments for health, schools, police and other public services.

The Treasury publishes a report alongside the Budget, which sets out further details about the measures and what they will cost.

The independent Office for Budget Responsibility (OBR) - which monitors government spending - also assesses the plans.

The Labour Leader of the Opposition, Keir Starmer, will respond to the Budget as soon as Mr Hunt sits down.

MPs will then debate the contents, before the government introduces a Finance Bill to turn the Budget proposals into law.

The chancellor's speech usually starts at about 12:30 UK time and lasts about an hour.

It will be broadcast live on the BBC iPlayer and the BBC news website.

This will be the last Budget before the general election, which must be by the end of January.

The UK economy went into recession at the end of 2023, after shrinking for two three-month periods in a row.

The recession is not expected to last long. Bank of England governor Andrew Bailey told MPs it may already be over.

But even if the economy grows in the first three months of 2024, many households are still struggling financially, after two years of rising prices.

Income taxes

The government has hinted that it wants to cut taxes. But it has also suggested there may not be enough money to make big changes.

Cutting the main rate of income tax by 1p would cost £7bn, according to the Resolution Foundation think tank.

Alternatively, the government could spend a similar amount cancelling the current freeze on the amount of money people can earn before they start paying tax or qualify for higher rates.

Allowing the tax thresholds to rise in line with inflation again would mean millions paying less tax.

In January, the International Monetary Fund (IMF) warned the UK not to cut taxes.

The Institute for Fiscal Studies (IFS) think tank also said the government should not cut taxes without spelling out how it would afford them.

Hunt mulls public service squeeze to fund tax cuts

National Insurance

The BBC understands that the government is considering a further cut to National Insurance (NI).

In the 2023 Autumn Statement, the chancellor announced an NI cut for 27 million workers which took effect in January. Self-employed NI rates will drop in April.

A further 1% NI cut would cost £4.5bn per year.

99% mortgages

According to reports in the Financial Times, the chancellor may introduce 99% mortgages.

This could make it easier for first-time buyers to get on the housing ladder, as they would need only a 1% deposit.

But critics have warned such a scheme could put borrowers at risk of negative equity, if falling house prices meant they owed more than the value of their property.

And other experts have pointed out it would not address the need to build more homes across the UK.

Vaping

A UK-wide ban on disposable vapes has already been announced.

The government is also considering a new tax on vapes.

Vaping products are subject to value added tax (VAT) - but unlike tobacco, do not currently also attract a separate levy.

Fuel duty

Fuel duty has been frozen since 2011, so a change could be unpopular.

But a 5p fuel duty increase has been pencilled in for later in March.

The Resolution Foundation calculates scrapping it would cost £2bn in 2024-2025.

Inheritance tax

A cut in inheritance tax (IHT) would benefit better-off families.

Typically, only 4% of estates are subject to IHT, about 27,000 a year.

Nevertheless, the chancellor may look at changing that threshold to reflect rising house prices.

Abolishing it altogether would cost £7bn, according to the IFS.

Childcare

The government has already announced an expansion of free childcare places in England, beginning in April.

But in January, the chancellor acknowledged the current child-benefit rules may be unfair.

Currently, claimants who earn more than £50,000 lose some of their family's child benefit - but a family where two parents collectively earn more than £50,000 receives the full amount.

The chancellor may decide to raise the threshold at which this applies.

Holiday lets

The government is already clamping down on holiday lets.

And it may detail new controls in England designed to prevent local people being priced out of the housing market.

Owners may need council permission to turn their home into a short-term let.

Does the Budget affect all parts of the UK?

Some parts of the Budget, such as defence spending, affect the whole of the UK.

Others, such as education, only affect England.

This is because Scotland, Wales and Northern Ireland make their own decisions on this policy area.

Scotland has income tax-raising powers, which means its rates differ from the rest of the UK.

The Scottish government set out its budget for the 2024-2025 tax year, in December, and announced two tax increases taking effect in April.

If the government announces extra spending on areas that only affect England, the other nations get an equivalent extra sum of money to spend as they choose, according to a rule called the Barnett formula.

-bbc