Chancellor Kwasi Kwarteng has unveiled his Mini Budget, claiming these are the biggest tax cuts! What does this includes? See below to find out!
Income Tax Currently people in England, Wales and Northern Ireland are paying 20% on their annual earning between £12,500 - £50,200. - From April 2023, there will be a cut in the basic rate of Income Tax to 19%, meaning an estimate of 31 million people will be getting £170 a year more! - The rule of 45% higher rate of income tax will be abolished and there will only be One Single Higher Rate of Income Tax of 40% from April 2023. National Insurance The rise in National Insurance Tax to 1.25% was introduced in April this year - This rise will now be reversed from 6 November!
Corporation Tax Corp Tax was supposed to increase from 19% to 25% from April 2023
- This has now been cancelled in the Mini Budget saving business pay an extra 6%
Universal Credit - Rules around Universal credit has been tightened, by reducing benefits if people are not fulfilling job search commitments. - They have been asked to take active steps to seek work, or face having benefits reduced. Stamp Duty
- There will be no stamp duty on the first £250,000 and for first time buyers that rises to £425,000! This will come into operation today!
Energy Bills - There will be a freeze on energy bills... the government claims that this will reduce inflation by 5 percentage points!
Shopping - For overseas visitors, shopping will be VAT-Free!
- The planned increases in duties on beer, ciders, wine and sprites will now be cancelled!
Infrastructure and investment zones
- Currently the government are discussing the setting up investment zones with 38 local areas in England. - Tax cuts and liberalised planning rules are to be offered to release land for housing and commercial use - Investment zones are going to be offered measures such as no business rates and stamp duty waived
-New legislation to cut planning rules, get rid of EU regulations and environmental assessments in an effort to help speed up building
IR35 reforms are also to be scrapped in April 2023 - Contractors working for an organisation will once again be responsible to determining their employment status and paying the appropriate amount of tax and national insurance contributions.
- This change will free up time and money for businesses that engage with contractors!
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