The UK government has reversed “almost all” of the tax cuts announced in last month’s mini-budget.
New Chancellor Jeremy Hunt said that a planned 1p reduction in the basic rate of income tax from April 2023 will be delayed “indefinitely” until economic conditions allow for the cut.
The government’s energy bills support scheme is also being scaled back and will now only be universal until April — not for two years as originally planned.
Other measures axed from Kwasi Kwarteng’s mini-budget include:
* Cuts to dividend tax rates
* The reversal of IR35 rules for the self-employed
* A new VAT-free shopping scheme for non-UK visitors
* The freeze on alcohol duty rates
This follows on from the previously announced decisions to scrap proposals to remove the additional rate of income tax and to cancel the planned increase in corporation tax.
Taken together, these changes are worth an estimated £32bn a year.
“The objective is to design a new approach that will cost the taxpayer significantly less than planned, whilst ensuring enough support for those in need,” Hunt said.
“Any support for businesses will be targeted to those most affected and the new approach will better incentivise energy efficiency.
“The most important objective for our country right now is stability.”
