What Boris Johnson’s Conservative election win means for your money – from tax cuts to boosting your pension pot
MILLIONS of households will benefit from tax cuts, a boost to their pension and cheaper fuel if Boris Johnson pushes ahead with his election promises after his Tory victory.
His landslide Conservative win could also spell good news for businesses across the country after the Prime Minister pledged £1billion worth of tax cuts.
For property buyers, Boris said he’s considering upping the stamp duty threshold to £500,000, making it more affordable to move up the ladder.
The PM led his party to a 364-seat win, while Jeremy Corbyn suffered devastating losses and vowed to stand down as Labour leader.
In the first hint of how the economy is reacting to Boris' stonking victory, the pound has already shot up against the euro and US dollar.
Here’s what Boris’ return to Number 10 means for you and your money:
Tax cuts for workers
In one of his boldest election moves, Boris pledged a £465 tax cut for the majority of UK workers.
The PM wooed voters by promising to raise the National Insurance threshold from £8,632 to £9,500 from April 2020.
That will mean a £100 tax cut for most workers a year, to start.
Tories say the threshold will be raised to £12,500 by the mid-2020s, saving low-income workers £465 a year in total.
The move is ultimately expected to save 2.4million people from paying the tax altogether.
The Tories have also pledged to not raise income tax, National Insurance or VAT in the next parliament.
Laura Suter, personal finance expert at AJ Bell, said: “National Insurance rates have rarely been so discussed as the past week and the Tory manifesto makes clear that they would raise the threshold.”
Stamp duty relief
While campaigning to be the next Tory leader, Boris said he would consider scrapping stamp duty altogether for properties under £500,000.
To do this, the Tories plan on increasing the tax threshold to £500,000 from its current level of £125,000.
Boris has also vowed to switch the liability of paying stamp duty from the buyer to the seller.
According to estate agent Purplebricks, the move would cut the average stamp duty paid by movers by 63 per cent from £6,800 to £2,500.
Purplebricks CEO Vic Darvey said: “Reforming Stamp Duty is the key to unlocking growth and getting Britain moving.
“These proposals will kick start both the UK property market and the wider economy.”
Pension protection
Boris promised to protect the so-called pensions "triple lock" in a boost for hard-working Brits saving for their retirement.
Introduced by David Cameron in 2010, the triple lock has ensured the state pension has gone up by at least 2.5 per cent a year.
The Tories have also pledged to fix a tax relief anomaly which sees low earners, most of which are women, miss out on £8,000 for their retirement.
Those affected are members of pension schemes who don't pay income tax and are saving into schemes that operate a net pay arrangement.
The personal allowance currently sits at £12,500, which is above the auto-enrolment minimum threshold of £10,000.
Boris has also pledged to fix the tapered annual allowance which is affecting high earners’ pensions, as well as proposing to bring back the Pensions Bill.
The Pensions Bill includes long-awaited rules around pension dashboards.
Pound rebound
The pound reacts badly to uncertainty, so Boris remaining in power and vowing to end the Brexit deadlock sent it soaring last night.
Sterling rose almost 2.2 per cent after the Opsos Mori exit poll was published last night.
At the time of writing on Friday morning, the value of £1 is currently sitting at $1.34 and €1.20.
Adrian Lowcock, head of personal investing at Willis Owen, said: “Investors are going to be relieved, and the pound has already rocketed on the back of the exit polls as fears of a hung parliament were removed.
“In terms of markets today, a Conservative majority is likely to be well received.”
Fuel duty freeze
Boris promised Britain’s 37 million drivers that they won’t face a hike in fuel duty if he won the election.
Grilled by The Sun after a speech in London back in November, Mr Johnson said: “We don’t want to raise fuel duty, I have absolutely no intention to raise fuel duty.”
Boost for businesses
Boris has pledged to reduce business rates and provide a series of tax breaks worth £1billion a year by 2022-23.
As part of the plans, the PM said his party will increase the employment allowance from £3,000 to £4,000.
This would provide a cut in National Insurance of up to £1,000 for more than half a million businesses.
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