On 23rd September the Chancellor, Kwasi Kwarteng announced a range of measures to boost economic growth and support businesses. Key highlights for businesses to know are:
National insurance
- Businesses will no longer have to pay a higher level of employer national insurance. The 1.25 percentage point rise in national insurance will be reversed from 6 Nov.
- Planned health and social care levy which was coming into force in April 2023 has been cancelled.
Income tax
- Basic rate of income tax will be cut to 19p in April 2023, one year earlier than planned.
- The top rate of income tax (45% for those earning over £150,00) is also being abolished.
- One single higher rate of income tax of 40% from April next year.
Shopping and hospitality
- VAT free shopping for overseas visitors.
- Planned increase in duty rates for beer, cider, wine and spirits cancelled. The government will also extend draught relief to cover smaller kegs of 20 litres and above.
Energy
- The Energy Bill Relief Scheme will reduce wholesale energy costs for all UK businesses, charities and public sector organisations.
- Gas and electricity prices will be fixed for businesses from 1 October.
- Under the scheme wholesale prices will be fixed for all non-domestic energy customers at £211 per MWh for electricity and £75 per MWh for gas for six months, less than half the wholesale prices anticipated this winter.
Corporation tax
- Planned rise in corporation tax cancelled, it will remain at 19%.
Bankers bonuses
- Cap on bankers bonuses will be lifted.
Other measures announced:
- The government will legislate to remove planning restrictions that restrain growth. There will be announcements in the coming weeks to cover the planning system and business regulations.
- New investment zones to accelerate growth will be created, areas mentioned include the West Midlands, the Tees Valley and Somerset. They will be allowed to relax planning rules and reduce business taxes to encourage investment.
- Stamp Duty will be cut. The cut raises the threshold of how much a property has to cost before stamp duty is paid to £250,000. First time buyers currently pay no stamp duty on the first £300,000, that will be raised to £425,000.
- The government will legislate to require trade unions to put pay offers from employers to a vote of members.
Further information about the Government’s Growth Plan can be found here.
We will keep you updated on any further details announced.
Kingston First Team
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