GBP : UK: Tax Relief Boost for GBP – ING
UK Budget in this March month is key event for GBP Movements in this month, UK Chancellor Jeremy Hunt is expected to do tax relief packages for Public and Private companies or giving favor for Foreign investors in UK. Both will be positive for GBP Growth in the near term.
This Budget will be supportive for public due to pre-election benefits for attraction to Voters .
Critical Week for UK Markets: ING Analyzes GBP Outlook Ahead of Spring Budget
GBPUSD is moving in Descending channel and market has reached lower high area of the channel
The upcoming UK budget poses a significant event risk for the Sterling. Despite hopes for pre-election tax cuts, funding constraints may limit their delivery, even though increased headroom is estimated at £18bn, up from £13bn due to slightly lower market rates compared to the November Autumn Statement.
Reports suggest Hunt is likely to scale back the tax relief package, with support measures anticipated to be smaller than those in November. A moderately-sized tax relief package, one avoiding gilts turmoil, could potentially offer support to GBP this week, although the range of possibilities remains wide.
GBP: UK Finance Minister’s Last Chance: Pre-Election Tax Cuts Expected
UK Budget in this March month is key event for GBP Movements in this month, UK Chancellor Jeremy Hunt is expected to do tax relief packages for Public and Private companies or giving favor for Foreign investors in UK. Both will be positive for GBP Growth in the near term.
This Budget will be supportive for public due to pre-election benefits for attraction to Voters .
UK Finance Minister Jeremy Hunt Expected to Announce Modest Tax Cuts in Spring Budget
As the Conservative government faces its last fiscal event before the upcoming General Election, Hunt is under pressure to provide voter incentives, trailing the Labour Party by over 20 points in polls. Despite constraints from fragile public finances and a stagnant economy, a small fiscal windfall may allow for tax cuts. Inflation has fallen, and interest rate expectations are low, offering some positive economic indicators.
The Treasury plans to deliver £1.8 billion in benefits by boosting public sector productivity, and £360 million for R&D in life sciences, automotive, and aerospace sectors. While fiscal headroom is estimated to have increased, tax cut details remain uncertain. Deutsche Bank suggests supply-side measures, focusing on National Insurance contributions and child benefits. Potential extensions of existing freezes on fuel duty are also considered.
Hunt’s Autumn Statement featured a National Insurance cut, but economists noted its offset by income tax freezes. Deutsche Bank expects a net fiscal loosening of £15 billion, dropping to £12.5 billion in the medium term. BNP Paribas predicts a more modest tax cut package of around £10 billion in the 2024/25 fiscal year, aiming to stimulate labor supply.
GBPUSD is moving in Descending channel and market has reached lower high area of the channel
The French bank anticipises the government to spend £10 billion of the fiscal windfall, postpone the March 2024 fuel duty rise, and introduce a permanent 1 pence reduction in the basic income tax rate. As the Budget could be the last chance to loosen fiscal policy before the election, Chancellor Hunt is expected to utilize any available fiscal space.
GBP: Hunt Plans Personal Tax Cuts in Budget
UK Budget in this March month is key event for GBP Movements in this month, UK Chancellor Jeremy Hunt is expected to do tax relief packages for Public and Private companies or giving favor for Foreign investors in UK. Both will be positive for GBP Growth in the near term.
This Budget will be supportive for public due to pre-election benefits for attraction to Voters .
Chancellor Jeremy Hunt Plans Personal Tax Cuts in Upcoming Budget
Chancellor Jeremy Hunt aims to cut personal taxes in the upcoming Budget on Wednesday, intending to boost Conservative MPs’ morale before the general election. While economic forecasts have posed challenges, Hunt expressed a commitment to the “long path” of lowering taxation.
Expectations of significant tax cuts have been tempered, with hopes centered on a possible 2p reduction in national insurance rates, akin to his November announcement. Hunt’s team acknowledges the desire for tax cuts but emphasizes fiscal responsibility. Potential revenue sources for the tax cuts include reforms to the “non-dom” tax regime, air passenger duty, a windfall levy on oil and gas, a vape tax, and changes to the furnished holiday let regime. Hunt may also consider cutting public spending, sparking controversy over the funding of present tax cuts based on future promises.
GBPUSD is moving in box pattern and market has rebounded from the support area of the pattern
The Budget is expected to highlight the government’s progress, with Hunt unveiling an investment package for life sciences and manufacturing sectors to promote long-term growth. Despite facing re-election challenges in his constituency, Hunt remains focused on continuing as chancellor after the general election.
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