Newly appointed Chancellor, Jeremy Hunt has today announced (Monday 17 October 2022), in what is being hailed as the biggest U-turn in British economic history, almost all measures set out by ex Chancellor Kwasi Kwarteng in his Mini Budget late-September, have been reversed.
Hunt vowed, “there will be more difficult decisions” on tax and spending and there will need to be cuts.
Individuals and Businesses
National Insurance (NI) – The original reversal of the 1.25% National Insurance increase, will continue to be reversed from 6 November 2022.
As previously reported, both employers and employees on average will save NI of £330 per year.
Income Tax – It was announced the basic rate of Income Tax would be cut from 20% to 19% from April 2023. The Chancellor has today announced this tax cut will be scrapped indefinitely and the basic rate is to remain at 20%.
Stamp Duty Land Tax (SDLT) – Hunt has announced the cut to SDLT will remain. The first £250,000 will be duty free and first time buyers won’t pay SDLT on the first £425,000.
Businesses
Corporation Tax – Truss announced on Friday 14 October 2022, the Corporation Tax cut was to be reversed, meaning in April 2023 companies with profits up to £50k will continue to pay tax at 19% however, companies with profits between £50k and £250k will pay a rate which gradually increases from 19% up to 25% (A marginal rate of 26.5%).
Alcohol Duty – The planned rise in duty rates for beer, cider, wine and spirits was originally scrapped, however the rise will now continue.
IR35 – Current rules surrounding IR35 will remain.
Other Announcements
Energy Support – The government announced their Energy Price Guarantee which was originally in place for 2 years. Hunt has today announced this support will only be in place for 6 months, reviewing support provided from April. Hunt said there would be “a new approach” targeting those in the most need.
Overseas Visitors – It was announced that visitors from overseas would be able to shop VAT-free. Hunt has today reversed this announcement.
How we can help
If you have any questions on how the announcements impact on you or your business, please contact us at mail@seavorchartered.co.uk or 01228 904904.
