The Prime Minister has indicated that she is willing to make “tough choices” in this Friday’s mini-budget speech in order to spur economic growth and is prepared to implement a number of tax cuts by the end of the week.
Stamp duty cuts are one of the tax reductions being discussed in the run-up to Friday’s mini-budget.
We evaluate how the fiscal statement will likely affect individuals.
Stamp Duty
It has been claimed that the Prime Minister and Chancellor Kwasi Kwarteng have been working on measures to significantly reduce stamp duty for over a month.
In the past, the Prime Minister has voiced her approval of a reduction in stamp duty. She argued, in her capacity as Treasury chief secretary, that the highest stamp duty rate was “clogging up” the property market and reducing the number of sales.
According to reports, Ms. Truss thinks reducing stamp duty would boost the economy by making it easier for first-time buyers to enter the housing market and driving more individuals to move.
Corporation Tax
The Prime Minister has apparently stated she will not be going through with the proposed hike in corporate tax, meaning the hike from 19% to 25% will not happen.
According to Liz Truss and Kwasi Kwarteng, raising taxes would be counterproductive to the economy and would slow down investment.
She told Sky News: “In order to get that economic growth, Britain has to be competitive. If we put up taxes, if we have arbitrary taxes on energy companies, if we have high corporation tax, we’re not going to get that investment and growth.”
National Insurance
Ms. Truss has made it plain that she intends to roll back the national insurance (NI) rise this November, making good on a promise she made during her leadership campaign to abolish the increase, which boosted NI by 1.25% for both employers and workers.
Energy Support
The Energy Price Guarantee and the Energy Bill Relief Scheme are two components of an energy support package that have already been introduced to help individuals, businesses, and the public sector with their energy costs.
Green levies, a catchall term for a collection of government regulations that tax energy companies on their environmental credentials and are often passed onto customers in the form of increased bills, may be scrapped.
As further information is released, we will keep you updated with what is announced in this emergency mini-budget. Get in touch with us at enquiries@aitaccountants.co.uk if you feel you need expert support – we’re here to help.
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