This is the first increase to the VAT registration threshold for seven years.

In his statement to the House of Commons announcing the Spring Budget, Mr Hunt said the move "...will bring tens of thousands of businesses out of paying VAT altogether and encourage many more to invest and grow".

Self-employed National Insurance has also been cut, from 8% to 6%, with the Chancellor stating this will result in a saving of £350 a year for an average self-employed individual.

In addition, the Chancellor has elected to maintain the 5p cut and freeze to fuel duty until March 2025, which will save the average car driver £50 next year and bring total savings since the 5p cut was introduced to around £250, the government says.

Commenting on the budget, Kevin Wellman, Chief Executive at the CIPHE, said: “Many will be pleased to hear the government’s announcement of a cut to National Insurance today. However, these cuts do not go far enough.

“The rising cost of fuel and materials has created the perfect storm for many plumbers and installers, in particular sole traders who have struggled to successfully pass on rising costs due to customers struggling themselves, and even disputing payment.

"In the heating and plumbing industry, installers have no choice but to make hefty upfront payments for products, such as boilers, meaning they are constantly being left out of pocket.

“This has had a major impact on cash flow, affecting profits and take-home pay. While there are services that can support plumbers in requesting the money they are owed, this can be a timely and costly matter.  

“The government talks of a positive ‘payment culture’ but it needs to put its money where its mouth is and ensure that consumers can have the work done that they need without plumbing and heating professionals footing the bill.”