Which is more important to you - lower taxes or better public services? Poll of the week

After chancellor Jeremy Hunt unveiled the 2024 spring budget, Yahoo News asks readers for their views.

Yahoo UK's poll of the week lets you vote and indicate your strength of feeling on one of the week's hot topics. After 72 hours the poll closes and, each Friday, we'll publish and analyse the results, giving readers the chance to see how polarising a topic has become and if their view chimes with other Yahoo UK readers.

A collection of modern British banknotes surrounding the HM Revenue & Customs heading on a UK Government tax form.
What do you think of Jeremy Hunt's reported plan to slash National Insurance? (Getty Images)

Jeremy Hunt has declared that "lower taxes mean higher growth", as he unveiled his spring budget in Parliament on Wednesday.

The chancellor said such growth "cannot come from unlimited migration", setting out his vision for building a higher-skilled, higher-wage economy.

While Hunt wouldn't give too much away ahead of his budget, he went ahead with his widely anticipated move of cutting National Insurance by another 2p from 10% to 8%, in a move he says will save the average employee an additional £450 per year.

Combined with his previous cut to NI in his autumn statement, he said this would mean an overall tax saving of £900 for 27 million employees, although the combined cuts are expected to cost the Treasury £10bn.

Hunt told the Commons that the average earner in the UK "now has the lowest effective personal tax rate since 1975". He added: "Their effective taxes are now lower than America, France, Germany or any other G7 country."

Labour was prepared for the prospect of Hunt "stealing" one of its key policies of abolishing the non-dom tax loophole, but the chancellor tried to please both sides of the house with a compromise, unveiling a new system where new arrivals in the UK won't have to pay tax on foreign income for their first four years – saving the Treasury an estimated £2.7bn a year.

In a move that is bound to please voters at a time when the Tories are struggling in the polls, Hunt confirmed he will maintain a 5p cut and a freeze on fuel duty for another 12 months, purportedly saving drivers an average of £50 next year.

Hunt announced the extension of an alcohol duty freeze until 2025, benefiting 38,000 pubs across the UK, and in another bid to help "tens of thousands of businesses", he said VAT registration threshold will be increased from £85,000 to £90,000 from the start of April.

Other measures include a new excise duty on vaping products from 2026, abolishing tax breaks on holiday lettings and a one off adjudgment air passenger flights for inflation. While tax cuts will inevitably be popular, a recent YouGov suggests voters marginally would prefer "increasing spending on public services" over "cutting taxes that everyday people pay".

But what do you think? Yahoo News asks readers below what they think of Hunt's anticipated package of tax cuts. Come back on Friday to read the results and analysis via the link below.

Read more of Yahoo UK's Poll of the Week articles

While it is certainly more complex than saying the higher taxes we pay the more money will go to fund our public services, it is also the case that any tax cuts announced by Hunt will need to be paid for somehow - particularly if they are going to cost the Treasury £10bn.

And local councils have warned that the financial crisis many of them are going through at the moment is being exacerbated by central government "passing the buck" to them.

Rishi Sunak's government has long been accused of forcing local councils to raise council tax while providing inadequate funding to save money for Westminster.

Last month, the cross-party Levelling Up, Housing and Communities Committee urged the government to step in and "fix the £4bn hole" in local authority finances, which is forcing most councils to raise their taxes by the maximum permitted amount.

Speaking to BBC Newsnight, Local Government Association chairman Shaun Davies said: "This is simple maths. We're seeing an increase in a demand for services, the increased cost of providing those services, and at the same time income is going down.

"You've seen councils using reserves... you've seen council tax has been doubled over the last 10 years. There is less money going from Whitehall to the town halls, so taxpayers are paying more locally, but getting less local services back."

While many voters are crying out for improved public services, Hunt told the Commons on Wednesday that a lot of money can be clawed back through efficiency savings.

His budget included a £3.4bn investment in NHS IT systems, which he said "helps unlock £35bn of savings", along with new investment to slash "30 million hours" for staff, including potentially cutting form-filling among doctors in half using AI.

As for the police, he said £230m of "time and money saving" measures would include allowing people to report crimes via video call, and, in come cases, sending drones as first responders.

It is not uncommon for governments to target efficiency as a cost saving, but whether this latest attempt will prove successful only time will tell.

What services does central government pay for?

As you can see from this chart by the Institute for Fiscal Studies, some key components of central government spending are the NHS, benefits paid by the Department for Work and Pensions (DWP), education and defence. Police and fire services are funded by a combination of central government funding and small precept on council tax.

An overview of how central government spent its money last year. (IFS)

What services does local government pay for?

According to a survey by the Local Government Information Unit last week, below are the percentage of councils that said they were likely to cut funding to each area referenced, with 1 in 3 of those who responded saying they plan to cut parks and leisure budgets.