LONDON (AP) — The Latest on the British government’s public spending plans (all times local): 5:00 p.m. British Treasury chief Philip Hammond has said “the era of austerity is finally coming to an end,” as…
LONDON (AP) — The Latest on the British government’s public spending plans (all times local):
British Treasury chief Philip Hammond has said “the era of austerity is finally coming to an end,” as he delivered a budget offering a modest uplift in public spending and few major tax increases.
Hammond said improving public finances after years of belt-tightening meant he could give government departments a real-terms spending boost next year. Beneficiaries include the Ministry of Defense, which will get an extra 1 billion pounds ($1.3 billion).
There is also more money for mental-health services and social care, and 1 billion pounds to ease the transition to a simplified benefits system known as Universal Credit.
Small businesses get a cut in property tax rates, and workers will see an increase in the amount they can earn before paying income tax.
But Hammond cautioned that he might need to re-think the budget if Britain leaves the European Union in March without a divorce deal.
Britain’s U.K. Treasury chief says the government will introduce a tax on big internet companies’ revenues, saying the nation could not negotiate forever with other countries in coming up with a global solution.
Philip Hammond announced a “digital services tax” as he unveiled his budget Monday to the House of Commons. He says the tax will be “narrowly-targeted tax” on the U.K.-generated revenues of specific digital platform business models.
He said it will be structured to ensure that “established tech giants rather than our tech startups shoulder the burden.” It will only apply to firms making 500 million pounds ($650 million) a year in global revenues.
The text will come into effect in April 2020 and is forecast to bring in 400 million pounds a year.
Britain’s Treasury chief is planning to pour 2 billion pounds ($2.5 billion) into mental health services as he delivers his final budget before the country leaves the European Union.
Philip Hammond’s infusion is one of the expected highlights of the spending blueprint to be delivered to the House of Commons on Monday. He’s also signaled he intends to increase National Health Service funding by 20 billion pounds a year by 2023 without raising taxes.
But Hammond may not yet be ready to ease the austerity implemented by a series of Conservative-led governments after the global financial crisis despite public pressure to ease the pain now.
He has urged caution, saying plans to increase spending could be thrown off track if Britain fails to secure a Bexit deal that protects trade.