PHILIP Hammond doled out surprise income tax cuts worth hundreds of pounds next year to Britain’s 32million workers yesterday.

Billed as another end of austerity boost, the Chancellor announced that personal tax-free thresholds will leap up from April 2019.

The popular move is a Tory manifesto promise, but a major relaxation of Government spending rules means he’s able to deliver it a year earlier than the 2020 date it was originally promsied.

From next April, no income tax will have to be paid on the first £12,500 of annual wages, up from today’s threshold of £11,850.

That delivers a £130 a year tax cut to 26million basic rate tax payers.

And the higher rate of tax will now only have to be paid on salaries of £50,000 year, up from £46,350 at the moment.

Six million higher rate taxpayers on the 40p band will see cash back of £495 a year.

And there will be further income tax cuts in each of the following four years, Mr Hammond also announced, when the thresholds go up in line with inflation.

The announcement was the big surprise rabbit in the Chancellor’s jumbo 8,800-word Budget speech, which took 72 minutes to deliver.

Announcing it, Mr Hammond described it as “the hard work of the British people paying off in hard cash in their pockets”.

The move will cost the Exchequer a £2billion a year, and a whopping £10billion by 2024.

In total, it will mean the Tory government has taken a total of 1.7million people out of paying any income tax altogether since 2015.

The income tax cut was also by far the biggest bazooka in Mr Hammond’s jumbo package yesterday to tackle Britain’s spiralling cost of living.

He also spent billions freezing fuel duty for the ninth year in a row – another win in a long running Sun campaign – bringing the total saving to the average car driver to over £1,000 since they started in 2010.

The Chancellor ordered all bosses to pay a minimum wage of £7.83 to £8.21, a 4.9% hike, from next April as well.

And he scrapped planned rises in the levies on beer and spirits, as well as pouring billions back into Universal Credit to help the nation’s struggling workers.

Mr Hammond told delighted Tory MPs yesterday: “I recognise that many people are feeling pressure on their household budgets now.

“It’s only by dealing with our debts and tackling the long term challenges our country faces, that we can sustainably raise wages and living standards.”

To fund the popular tax giveaways, the Chancellor also slapped a series of stealth tax raids on sole traders to close long-standing tax loopholes.

Mr Hammond will raise an extra £3.1 billion over four years by closing a loophole that allows companies and contractors to avoid paying National Insurance contributions by setting themselves up as self-employed.

Treasury officials insisted the move will only affect 150,000 people and promised to delay introducing the new rules until 2020 to ensure genuinely self-employed people don’t face massive tax hikes.

But the Association of Independent Professionals and the Self-Employed (IPSE) warned that White Van Man risks getting “swept up by the Government’s smash-and-grab mentality” - and face being “taxed out of operation” by the move.

Another £485 million will be raised by the Chancellor through freezing the VAT threshold at £85,000 for a further two years - dragging thousands of firms into the sales tax regime.

Mr Hammond promised to introduce a “smoothing mechanism” that will see traders phased into VAT slowly - but only once we are free of EU rules which ban such a move.

And in another whammy for entrepreneurs, Mr Hammond put a new limit on the tax relief people get when they sell their business.

Under the move - which raises £260 million over five years - entrepreneurs will only get their Capital Gains Tax reduced to 10 per cent if they have owned their business for a minimum of two years - rather than the current qualifying period of 12 months.

Despite the major tax and spending giveaways, Labour leader Jeremy Corbyn still branded Mr Hammond’s blueprint as “the broken promise Budget” yesterday.

Replying to the Budget statement, the hard left party boss told the Chancellor: “The Government claims austerity has worked so now they can end it. That is absolutely the opposite of the truth - austerity needs to end because it has failed”.

And he claimed the Chancellor had “frittered away” extra cash in “ideological tax cuts to the richest in our society”.

Moments after Mr Hammond sat down a protest erupted in the public gallery of the House of Commons by around 50 pension campaigners.

The so called “WASPI Women” - who want 3.9 million women hit by pension changes compensated - waved banners and banged the security glass before being escorted out.

But to the fury of Commons bosses, opposition MPs from Labour and the SNP gave the campaigners a long standing ovation, led by Shadow Chancellor John McDonnell.

A grim historical omen also bode badly for Mr Hammond yesterday.

The last Chancellor to have delivered a Budget on a Monday, Tory Selwyn Lloyd, was sacked three months later by then Prime Minister Harold Macmillan.

Budgets are usually on a Wednesday, but it is suspected the Treasury insisted on moving it so as not to clash with Halloween tomorrow.

The Treasury also insisted that it needs five full days of continuous debate for the Budget in the Commons.

Working family: £890 a year better off
HARD-working Sam Henry and Flo Morrison are expecting their second child before the new year.

And thanks to the Budget, they will have another £890 to spend in 2019, an extra £17 each week.

Sam, 27, earns £23,500 a year as a planner for South Central Ambulance Service. The change in the tax threshold for basic-rate tax to £12,500 means he will get another £130 a year.

His wife Flo, 22, makes £5,470 working part-time for the ambulance service.

Flo, mum to Zac, two, also gets £600 a month Universal Credit, which is expected to rise by around £63 a month.

Last night Flo, from Fair Oak, Hants, who is due to give birth in December, said: “We’re saving up for our wedding so all our extra cash goes towards making that the best day ever.

“We’re also trying to buy a house, so anything we can save will mean we can own our home that bit sooner.

“I think the Chancellor has probably done the best he can do in difficult circumstances.”

High-rate taxpayer: £990 a year better off
AS a high-rate tax payer Eliot Stocker is a Budget big winner.

Software engineer Eliot, 28, will be £860 a year better off because the Chancellor decided to bring forward planned tax rate changes.

From April next year the threshold for 40 per cent tax will rise to £50,000 from £46,350.

Mr Hammond had originally intended to bring £50,000 earners into the 20 per cent tax bracket in 2020.

But he chose to do it a year early and Eliot, who earns over £50,000 a year, is delighted. His wife Janet, 26, a software developer, is a 20 per cent tax payer so she will be £130 better off after the Chancellor lifts the lower tax threshold from £11,850 to £12,500 in April.

Together they are £990 a year better off.

The couple, from Hove, East Sussex, bought their first house, for £235,000 just over a year ago, after saving for four years.

Janet says: “This Budget could actually make a decent amount of difference.”