14:05 PM, 27th October 2021, About 2 years ago 17
No Nasty New surprises were announced for Landlords in Chancellor Rishi Sunak’s 2021 Budget speech to Parliament today.
A key concern for landlords is inflationary pressure having to be released by the Bank of England increasing interest rates. The Office for Budget Responsibility (OBR) is predicting CPI inflation to average 4% over the next year. However, the Chancellor does not see this as a medium-term problem that must be immediately tackled by the Bank of England. He sees it as the sudden post lockdown recovery of demand not being matched in speed by the recovery of supply, exacerbated by the supply chain crises and a doubling of energy prices caused again by supply issues.
For tenant affordability, the National minimum wage will increase 6.6% from £8.91 to £9.50 next year and the Universal Credit taper rate is being cut 8% from 63% to 55% from December 1st this year. This cut in taper rate will more than offset the £20 per week temporary increase in UC being stopped for working families.
National insurance and Dividend tax rates are still increasing the planned 1.25% paid from April 2022.
Corporation tax is still planned to increase to 25% by April 2023. However, small businesses with profits of £50,000 or less will be maintained at the current rate of 19%. There will also be a taper above £50,000 so that only businesses with profits of a quarter of a million or greater will be taxed at the full 25% rate. That means only 10% of all companies will pay the full higher rate.
£5bn will be spent removing unsafe cladding. This will be funded through a Residential Property Developers Tax levied on developers with profits over £25m at a rate of four per cent. 31 housebuilders made that much profit in 2019.
£550m to tackle the Courts backlog
£11.5bn will be spent building 180,000 affordable homes
£640m will be spent tackling rough sleeping and Homelessness.
There will be a 50% Business Rate discount for Leisure
The planned fuel duty rise has again been frozen
The OBR forecast that our economy will grow this year by 4%, by 7.3% in 2022, then 1.7%, 1.6% and 1.7% in the last three years of the forecast.