Spring Budget Confirms More Funding For Wales
UK Chancellor Philip Hammond has dedicated an additional £200m in funding to the Welsh Government. The funding includes £149m of additional revenue funding between 2017-18 and 2019-20 and an extra £52m of capital funding for Wales between 2017-18 and 2020-21.
Phillip Hammond also announced measures designed to support companies affected by the business rates revaluation, by making the business rates system “fairer” following a backlash from lobby groups and MPs over the revaluation. The Chancellor said £25bn is raised by business rates so they cannot be abolished.
In addition, three measures have been announced to help struggling companies.
Any business coming out of small business rate relief will benefit from an extra cap – business rates bills will not increase by more than £50 a month.
There will be £1,000 discount on business rates for pubs with a rateable value less than £100,000.
A £300m fund will be made available to councils for discretionary relief for individual hard cases.
The business rates revaluation takes effect in England from April 2017.
However, the Spring budget will also see the main rate of self-employed national insurance contributions increasing.
Under the current system, people who are self-employed may have to pay both Class 4 and Class 2 NICs. Class 4 NICS at 9 per cent are paid on profits between £8,060 and £43,000, while Class 2 NICs are paid on profits of £5,965 or more.
When Class 2 NICs are abolished in 2018, the government has revealed that the main rate of Class 4 NICS for the self-employed will increase by 1 per cent to 10 per cent. A further increase to 11 per cent will follow in April 2019.
Taken together with the abolition of Class 2 NICs, the government said that this means only self-employed individuals with profits above £16,250 will have to pay more NICs.