The downfall of the Tory party.

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Chippy_Tea

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Chancellor Kwasi Kwarteng has unveiled what he claims are the biggest tax cuts in a generation, so what is in his mini-budget?

Income tax​

  • Cut in basic rate of income tax to 19% from April 2023
  • Government estimates 31 million people getting £170 a year more
  • Currently, people in England, Wales and Northern Ireland pay 20% on any annual earning between £12,571 to £50,270 - rates in Scotland are different
  • 45% higher rate of income tax abolished for England, Wales and Northern Ireland taxpayers
  • One single higher rate of income tax of 40% from April next year

National Insurance​

What is national insurance?

Corporation tax​

Does cutting corporation tax always raise more money?

Benefits​

  • Rules around universal credit tightened, by reducing benefits if people don't fulfil job search commitments
  • Around 120,000 more people on Universal Credit to be asked to take steps to seek more work, or face having their benefits reduced
  • Jobseekers over 50 to be given extra time with work coaches to help them return to job market
What is universal credit?

Work and investment​

  • IR35 rules - the rules which govern off-payroll working - to be simplified
  • Annual investment allowance, the amount companies can invest tax free, remains at £1m indefinitely
  • Regulations change so pensions funds can increase UK investments
  • New and start-up companies able to raise up to £250,000 under scheme giving tax relief to investors
  • Share options for employees doubled from £30,000 to £60,000

Stamp duty​

  • Cut to stamp duty which is paid when people buy a property in England and Northern Ireland
  • No stamp duty on first £250,000 and for first time buyers that rises to £425,000 - comes into operation today
  • 200,000 more people will be taken out of paying stamp duty altogether, government claims
What are the new stamp duty rates?

Energy​

  • Freeze on energy bills, which the government claims will reduce inflation by 5 percentage points
  • Total cost for the energy package expected to be around £60bn for the six months from October

Bankers' bonuses​

  • Rules which limit bankers' bonuses scrapped
  • Package of regulatory reforms to be set out later in the autumn

Shopping​

  • VAT-free shopping for overseas visitors
  • Planned increases in the duties on beer, for cider, for wine, and for spirits cancelled

Infrastructure and investment zones​

  • Government discussing setting up investment zones with 38 local areas in England
  • Tax cuts and liberalised planning rules to be offered to release land for housing and commercial use
  • Investment zones 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 speed up building
 
Magic money tree.

Does trickle-down economics actually work?


Some studies suggest a link between trickle-down economics and reduced growth, and some newspapers concluded that trickle-down economics does not promote jobs or growth, and that "policy makers shouldn't worry that raising taxes on the rich [...] will harm their economies".
 
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Disappointing. When you want to grow a business you don't cut your prices (and give the biggest discounts to the biggest customers), you invest in it.

I don't think that a country is much different.
 
Wow... just wow. Enormous benefits for the rich and business owners. Very little help for everyone else.
Released as a "mini" budget so they didn't have to have any scrutiny from the OMB.

Is it just me, or do "investment zones" sound a lot like "tax havens"?

I wonder where all the money to fund this is coming from?
Oh, I know: The Magic Money Tree again! (and even more defunding of the NHS, police and schools)

<silently leaves the thread before the angry people get here... if the last mini-budget thread got locked, I expect there will be blood spilled on this one 😅>
 
What happened with the plans of raising the basic rate tax band to 80k?🤔
 
The funny thing is, with changes to allowances etc, only someone earning over £155k per year will actually have a reduction in tax burden.

Yet they’ve made it seem much more generous than that to the squeezed middle.
 
Well, I would be to the political right, certainly as far as this Forum goes, but I have no idea what planet this thinking comes from.
It's almost like they have lost all sense of public sentiment and abandoned any semblance of political legitimacy.
 
I'll be one of the PAYE winners, saving £5.55 a month in tax, but then I don't pay a lot of tax in the first place. Hoping for a pay rise from my company pension fund next tax year. And praying the state pension won't be raided - two more years to wait for mine.
 

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