UK Budget 2024: general election battle lines become clearer

Andrew Henderson of Pinsent Masons said Hunt had struck a “bullish and upbeat tone” in his speech. He said this was “unsurprising”, despite the “strong economic headwinds” in the UK, because of the prospect of an election in the coming months. No date has yet been fixed for the general election.

Henderson said Hunt had been at pains to stress that the government had a plan for economic growth and to suggest the opposition Labour party does not have such a plan. Starmer, in contrast, sought to focus on the government’s record in power over the last 14 years, claiming people are now worse off than they were in 2010.

“In setting out his party's economic stall, Jeremy Hunt sought to appeal directly to voters – most prominently in the form of a further two pence cut in National Insurance,” Henderson said. “Other measures also were also intended to appeal to voters directly in the cost-of-living space, such as an extension of the five pence cut in fuel duty and extending the child benefit threshold from £50,000 to £60,000.”

Also included in the Budget was funding to boost public service productivity, including through digital transformation of the NHS; funding for automotive and aerospace R&D; a year’s extension to the ‘sunset’ clause for the energy profits levy, a tax paid by oil and gas producers; the abolition of multiple dwellings relief, among other residential property tax changes; the abolition of the current tax system applicable to ‘non-doms’ – UK residents who claim permanent residence in other jurisdictions – and plans to replace it with a new residency-based system; an increase in the threshold over which businesses must register to pay VAT; and tax breaks for the UK film and TV industries.

Henderson said: “With much of the content of his speech already briefed to the media, the Budget contained few surprises, with the chancellor instead emphasising repeatedly the value of his government having ‘a plan’, while that claiming that Labour did not. Battle lines for the general election are now clearly coming into focus.”