You won’t be able to go very far today without hearing about the Chancellor’s Budget announcement. Every 6 months, the Chancellor makes an appearance with his red briefcase and we all have to tune in to find out what changes are afoot. But amongst all the politics it’s sometimes difficult to know just how those changes affect us on a day to day basis. Well, to help makes things simple, we’ve put together a little round up of today’s news and how that’s likely to affect your car and home over the next 6 months.
Fuel duty frozen
Good news. Despite many people predicting the contrary, the Chancellor has capped fuel duty at 58p/litre for petrol and diesel. The UK consumes over 33.8m tonnes of fuel so even a small increase in duty would have hit every driver’s pocket hard. But with no changes to fuel duty today, and the average price for diesel last month coming in at just £1.01ppl (petrol is slightly higher at 102ppl) fuel remains more affordable then it was this time last year.
Annual ISA limit rises
Another positive take-out from today’s budget is that the Chancellor has increased the personal ISA allowance from £15,240 to £20,000 per year. That’s an extra £4,760 we can save without being taxed. With some ISAs now offering up to 2.5% interest on savings, you could compare cash ISAs now to put some money away for a rainy day or save for that special purchase.
£700m support for flood defences
After another devastating winter for home owners across the UK, the Chancellor has addressed the need for further flood defences by announcing support of £700m for flood defences schemes. He highlighted support for projects in York, Leeds and Carlisle - some of the areas who were hit hardest in January of this year. If you’re worried about your home, you can read more on how to protect your home from flooding here.
0.5% increase in IPT tax
Insurance Premium Tax (IPT) is a tax that the Government add to most insurance products that are sold in the UK. The Chancellor increased this to 9.5% in November 2015 and today he announced it would rise to 10%. This means that suppliers will need to pay a higher tax on the insurance products they’re selling and that is more than likely to have a direct impact on how much we pay for our car, home and travel insurance.
Simon McCulloch, our Director of Insurance, comments, “Whilst the rise in Insurance Premium Tax is far lower than many expected, it will still add around £140m of costs to UK consumers, simply for home insurance and car costs. The impact on individual households may appear small but we’ve calculated that the combined increases have added about £73 per household over the last nine months.”
So despite a relatively small increase announced, we could see it affect the price of premiums across a whole host of insurance products. You can make sure that you’re still getting the best deal for your car or home insurance by comparing quotes today.