In his Growth Plan 2022 (or mini-budget), in addition to
the headline measures to combat the effects of the energy crisis,
the Chancellor has made a number of changes to income tax,
corporation tax, national insurance and stamp duty land tax, to
kick start his economic policy of cutting taxes to boost
growth.
It appears that capital taxes (capital gains tax and inheritance
tax) were not within his sights at this time, although with the
winding up of the Office of Tax Simplification, they may be
targeted in his next fiscal event.
The main changes are as follows:
INCOME TAX
The basic rate of income tax will fall to 19% in April 2023, a
year earlier than promised by his predecessor, and the additional
rate of income tax (45% for those earning over £150,000) has
been abolished. The single higher rate remains at 40%. Further,
from April 2023 the 1.25% increase to the rate of income tax on
dividends which took effect in April 2022 will be reversed.
