UKMOD B1.12 released

Release B1.12 of UKMOD is now live, with updates to the Spring 2024 UK Budget Statement, the March 2024 OBR Economic and Fiscal Outlook, and the December 2023 Welsh and Scottish Budget Statements. The model is available for download from the CeMPA website at https://www.microsimulation.ac.uk/ukmod/access/.

Updates include:

Parameter Updates

  • Update take-up parameters for pension credit and housing benefit of older people
  • Update uprating factors to reflect most recent data, including the OBR Economic and Fiscal Outlook, March 2024.
  • Update new minimum wage parameters for 2024/25
  • Update policy parameters following the March Spring Budget statement.
  • Update income tax parameters for Wales following the December Welsh Draft Budget statement.
  • Income tax rates and thresholds for Scotland updated to reflect December Budget statement.

Data Revisions

  • UKHLS data variants made fully available in public release.

Policy Reforms

  • New rate and threshold included for Scotland to reflect December Budget statement.
  • Amended description of the High Income Child Benefit Charge to capture reduced rate that charge is to be accrued announced in the Spring Budget Statement.

Budget Announcements

Changes to UKMOD parameters and code capture the following budget announcements:

  • Introduction of 45% Scottish advanced rate of income tax on income between £75,001and £125,140 from April 2024
  • Increase the Scottish top rate of income tax from 47% to 48% from April 2024
  • Cut the main rate of Class 1 employee NICs from 10% to 8% from April 2024
  • Cut the main rate of Class 4 self-employed NICs from 8% to 6% from April 2024
  • Increase income threshold of the High Income Child Benefit Charge from £50,000 to£60,000 from April 2024
  • Reduce the rate at which the High Income Child Benefit Charge accrues on income above the threshold from 1% of Child Benefit per £100 of annual income, to 0.5%from April 2024
  • 12 month extension to the 5p cut in rates and no RPI increase in 2024/25
  • Freeze rates of alcohol duty until 2025/26
  • A one-off tobacco duty increase of £2.00 per 100 cigarettes or 50 grams of tobacco from 1 October 2026
  • Maintain the starting rate for tax on savings at £5,000 for 2024-25
  • Freeze Class 2 National Insurance rates for 2024-25

Code Corrections and Amendments

  • New system added for 2027
  • New (experimental) TCO add-on to project indirect taxes – expenditure data not currently publicly available.
  • New policy added to calculate UK wide poverty line and permit sample limitationfor individual regions to be implemented at end of policy spine
  • Recode variable didpd=3 where ddi=1 for datasets from 2020 to account forlimitations to variables reported by FRS
  • Added variables to facilitate behavioural modelling
  • Re-working of behavioural add-on BVR
  • Amended simulation of income taxes to improve clarity and flexibility