- Chancellor unveils new growth plan, tackling energy costs to bring down inflation, backing business and helping households.
- Corporation tax rise cancelled, keeping it at 19% as government sets sights on 2.5% trend rate of growth.
- Basic rate of income tax cut to 19% in April 2023 – one year earlier than planned – with 31 million people getting on average £170 more per year.
- Stamp Duty cuts will help people on all levels of the property market and lift 200,000 homebuyers every year out of paying the tax altogether.
The government is cancelling the Health and Social Care Levy – initially introduced via a 1.25 percentage point rise in National Insurance contributions (NICs) – which took effect in April 2022.
This will be delivered in two parts:
- The government will reduce National Insurance rates from 6 November 2022, in effect removing the temporary 1.25 percentage point increase for the remainder of the 2022-23 tax year;
- The 1.25% Health and Social Care Levy will not come into force as a separate tax from 6 April 2023 as previously planned.
The corporation tax planned increase has now been cancelled, rather than rising to 25% from April 2023 the rate will remain at 19% for all firms, regardless of the amount of profit made. Also to help drive investment and growth the Annual Investment Allowance threshold has been permanently set at £1 million, rather than reverting to £200,000. This is a 100% capital allowance for qualifying expenditure on plant and machinery up to a specified annual limit and covers the investment needs of 99% of the UK’s businesses.
The government are removing the additional 45% rate of Income Tax on annual income above £150,000 from 6 April 2023.
With the major cuts on Stamp Duty Land Tax the nil rate threshold will be doubled from £125,000 to £250,000. The nil-rate threshold for First Time Buyers’ Relief is increased from £300,000 to £425,000 and the maximum amount that an individual can pay while remaining eligible for First Time Buyers’ Relief is increased to £625,000.
