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Budget Reversals

Benjamin Franklin once said that in this life nothing can be said to be certain except death and taxes. America’s founding father may be right but, following the recent budget reversals, whilst taxes might be certain the rate of tax charged is anything but.

The Chancellor, Jeremy Hunt, is due to publish his medium-term fiscal plan on 31^st October 2022 in tandem with a forecast from the Office for Budget Responsibility (OBR). We will report on that at the time but in the meantime here are a few of the announcements which we previously reported on in September which have now been reversed:

The planned increase in corporation tax to 25% will now take effect in April 2023.

The top tax rate of 45% is to be retained as is the current 20% basic tax rate.

Planned increases in the duty rates for alcohol will go ahead.

IR35 and dividend tax reforms will no longer go ahead.

And VAT free shopping for overseas visitors is no longer on the table.

 Meanwhile, still under review are previously announced plans to scrap the cap on banker’s bonuses; whilst the energy price cap measures will only be retained until April 2023 pending a review of what action should be taken going forward.

 On the plus side, the proposed scrapping of the National Insurance levy and the rise in stamp duty thresholds will go ahead as planned.