Mr Hunt delivered his Autumn Statement to parliament today (17 Nov 2022). He made it clear that the Government’s priorities are stability, growth and public services. The much talked about “Black Hole” of around £55 billion in the public finances is to be plugged a balance of tax measures and spending cuts.
Here’s an outline of the tax measures he has announced:
Personal taxes
- Reduce threshold for 45p higher rate tax £150,000 to £125,140
- All personal tax thresholds maintained until April 2028 Income Tax Personal Allowance, Higher Rate Threshold, main National Insurance thresholds, and Inheritance Tax thresholds for a further two years, taking us to April 2028
- Dividend allowance cut from £2,000 to £1,000 next year, and to £500 from April 2024
- The annual exempt amount for Capital Gains Tax will be cut from £12,300 to £6,000 next year and £3,000 from April 2024
- From April 2025 electric vehicles will no longer be exempt from vehicle excise duty. Company car tax rates will still be lower for electric vehicles and rate increases will be limited to 1% a year for 3 years from 2025
- Stamp Duty tax cuts announced in the mini budget will remain in place but only until 31 March 2025
Business Taxes
- Employers National Insurance Contribution threshold frozen until April 2028
- Employment Allowance maintained at £5,000
- VAT threshold maintained at current level until March 2026
- Cut deduction rate for SME R & D tax relief scheme to 86% and cut credit rate to 10%
- Increase in R & D expenditure credit from 13% to 20%
Other tax measures include:
- From 1 January 2023 until March 2028 Energy Profits Levy increased from 25% to 35%
- From 1 January 2023 a new temporary 45% levy on low carbon electricity generators
- Business rates, revaluation is proceeding from April 2023, but £14bn tax cut is promised over the next 5 years to include a new Transitional Relief Scheme, benefitting 700,000 businesses
Mr Hunt rounded off his hour-long speech by emphasising that a “Made in Russia” global energy and economic crisis would be met by a tough and inventive “Made in Britain” recovery.
