Chancellor cuts NI in last Budget before election

National Insurance (NI) contributions paid by employees and the self-employed will be cut by 2p in the pound, from 10% to 8%, effective from April.

Announcing the measure in the Budget, Chancellor Jeremy Hunt said the cut is worth around £450 a year for someone on an average salary. It follows an earlier 2p cut announced in November, which reduced the rate from 12% to 10%.

Other announcements in the last scheduled Budget before the next General Election include:

* Abolition of non-dom tax status for foreign nationals who live in the UK, but are officially domiciled overseas. It will be replaced by a new residency-based system where arrivals have access to a more generous scheme for their first four years of tax residency before paying tax in the same way as everyone else.

* The higher rate of capital gains tax on property will be cut from 28% to 24% in a move aimed at boosting transactions in the residential property market.

* Special tax rules for furnished holiday let properties and the purchase of multiple dwellings will be abolished.

* Fuel duty frozen again, with the 5p cut announced in 2022 maintained until March 2025.

* The freeze on alcohol duty is extended until February 2025.

* A new tax will be imposed on vaping products, alongside an increase in the existing tax on tobacco.

* The threshold at which small businesses must register to pay VAT is raised from £85,000 to £90,000.

* An extension of the windfall tax on the oil and gas sector to 2029.

* A new permanent rate for Theatre Tax Relief of 40%, and 45% for touring productions, and a new tax credit for independent British films with a budget of less than £15m.