Matt N
CF Legend
Hi guys. Today, UK Chancellor Kwasi Kwarteng got up in the House of Commons and held a “Mini Budget”. Now I would not normally make a topic for something as inconsequential as the Chancellor holding a budget; this happens once every 6 months and usually generates fairly little in the way of news. However, I thought that today’s “Mini Budget” should be an exception… because in my opinion, the announcements were actually very significant, and there was not much that was “mini” about it at all!
Now, new UK Prime Minister Liz Truss campaigned on a platform of “tax cuts and reform” in her recent leadership campaign. And this budget is certainly living up to that promise, as Kwarteng announced the biggest package of tax cuts since 1972…
In terms of what was announced, the basic points are as follows:
The government says that these economic plans will stimulate growth through investment into the UK by large companies and industries, but the plans are very controversial.
I won’t deny it, these plans are extremely radical, in my view, and are a very bold gamble. I trust that Truss and Kwarteng know what they’re doing, and this gamble could work, but there is a substantial amount of risk involved, in my opinion.
What do you guys think?
Source: https://www.itv.com/news/2022-09-23...s-you-need-to-know-as-huge-tax-cuts-announced
Now, new UK Prime Minister Liz Truss campaigned on a platform of “tax cuts and reform” in her recent leadership campaign. And this budget is certainly living up to that promise, as Kwarteng announced the biggest package of tax cuts since 1972…
In terms of what was announced, the basic points are as follows:
- The 45% rate of additional income tax for high earners (salaries of £150k+) has been scrapped entirely. This will be replaced by a single higher rate of income tax of 40%.
- Basic income tax has been cut from 20% to 19%.
- Stamp duty has been permanently cut. The threshold for buyers paying stamp duty on new homes is to go up to £250,000, from £125,000 currently. The threshold for first time buyers is being increased to £425,000 from £300,000 currently, and the threshold below which first time buyers can claim relief from stamp duty is increasing to £625,000, from £500,000 currently.
- The recent 1.25% increase in National Insurance (the Health & Social Care levy introduced by Boris Johnson) is to be reversed from 6th November.
- The welfare system is seeing a shake up that could see more than 100,000 people in part time work facing a benefits cut if they do not actively seek more work. Claimants working 15 hours per week or less on the National Living Wage will be asked to meet regularly with a work coach and take “active steps” to increase earnings. If they fail to do so, their benefits could be reduced.
- Energy bills are to be frozen at £2,500 as previously announced. Energy firms are also receiving a £40bn safety net.
- Minimum service levels are being introduced for union workers in order to cut down on strike action, and legislation will be introduced that will require unions to put pay offers to a members’ vote.
- The planned corporation tax rise is being cancelled; instead of rising to the planned 25%, it will remain at 19%, giving the UK the lowest corporation tax in the G20.
- The cap on bankers’ bonuses is being scrapped in order to drive growth in Britain’s financial services sector. Currently, bankers’ bonuses are capped at double their salary.
The government says that these economic plans will stimulate growth through investment into the UK by large companies and industries, but the plans are very controversial.
I won’t deny it, these plans are extremely radical, in my view, and are a very bold gamble. I trust that Truss and Kwarteng know what they’re doing, and this gamble could work, but there is a substantial amount of risk involved, in my opinion.
What do you guys think?
Source: https://www.itv.com/news/2022-09-23...s-you-need-to-know-as-huge-tax-cuts-announced
