Before Mr Kwarteng stood up to make his statement on ‘The Growth Plan’, much of what he had to say about energy support for businesses and households, bankers’ bonuses, investment zones and reversals to NICs had already been announced. The government also said that the Chancellor’s statement would not be subject to a forecast from the Office for Budget Responsibility. However, this did not stop the media from dubbing this event a Mini Budget.
The Growth Plan set out a new approach to the economy built around three central priorities:
- Reforming the supply-side of the economy
- Maintaining a responsible approach to public finances
- Cutting taxes to boost growth.
The main announcements included:
- The reversal of the Health and Social Care Levy Act and the 1.25% increase in NICs
- The cut in the basic rate of income tax from 20% to 19% from April 2023
- A reduction in dividend tax rates
- The reversal of the proposed plan to increase corporation tax to 25% – the corporation tax rate will remain at 19%
- The reversal of the proposed plan to reduce the Annual Investment Allowance from £1million to £200,000 – this will now not happen, and will remain at £1 million
- Changes to the Stamp Duty Land Tax regime.
We’ve reviewed these announcements, and more besides, in our downloadable summary, with supporting commentary from our teams, which you can access to the right (or below if viewing on mobile).
There were are significant, impactful changes announced yesterday, and we appreciate that you will have questions. Please do contact your usual engagement partner or any of our specialist advisors if we can help.