2022 United Kingdom budget

The 2022 United Kingdom budget was delivered by David Gauke, the Chancellor of the Exchequer, to the House of Commons on Wednesday, 23 March 2022. This was Gauke's third budget as Chancellor, and the second budget of the Second Osborne government formed after the 2020 general election. The budget took place in a background of rising unemployment, and slowing economic growth, with declining consumer and business confidence. The Office for Budget Responsibility estimated the UK's output gap at -0.4%, forecast to grow to -1% by March 2023.

Key points
The OBR estimated that the UK's budget deficit was to grow from just 0.7% of GDP in 2021-22, to over 2% in 2022-23, though the UK would maintain its structural budget surplus at around 0.1% of GDP. The OBR also forecast that the economy would grow by 0.7% in 2022, before shrinking by 0.4% in 2023. The economy would then grow by 1.7% in 2024, and 3% in 2025.

Taxes

 * The income tax personal allowance was raised from £8,804 to £10,000 from April 2022, whereafter it would be frozen for two years.
 * Consequently, the higher rate threshold was also raised from £88,040 to £100,000.
 * In the face of falling interest rates - and hence, falling mortgage rates - the government cut the allowance for the Mortgage Help to Pay scheme from £65,000 to £40,000 from April 2023.
 * The rate of corporation tax was cut from 14% to 12.5%.
 * Alcohol duty was frozen for two years.
 * Tobacco duties were raised by 8%, 7% above inflation.

Spending

 * HM Treasury planned to spend a total of £986bn over the course of the 2022-23 fiscal year, or 37% of GDP.
 * This was an increase of £67bn over the previous year in nominal terms, or £43bn in real terms.
 * After 2022-23, departmental spending would be frozen in real terms for four years, rather than the two planned in the previous year's budget - a measure forecast by the Office for Budget Responsibility to reduce government spending as a share of GDP to 34% by 2027, or the lowest level since the 1930s.