United-Kingdom

Latest Mini-Budget 2022: Kwarteng Cuts Stamp Duty and Higher Income Tax Rate

Latest Mini-Budget 2022: Kwarteng Cuts Stamp Duty and Higher Income Tax Rate

The energy bill package will cost £60 billion in the first six months, says Chancellor Kwasi Kwarting

Kwasi Kwarteng cut stamp duties and eliminated high income tax in a small budget that the Labor Party called a “plan to reward the really wealthy”.

The chancellor has unveiled tens of billions of additional spending and tax cuts in plans to boost economic growth.

This also included the abolition of maximum bonuses for bankers and a planned increase in the corporate tax on profits of large corporations.

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The government has dubbed the mini-budget its “growth plan” as the UK faces a cost-of-living crisis, recession, rising inflation and rising interest rates.

It was criticized by politicians, unions and charities, who said the country’s richest – not the poorest – would reap the benefits.

“The advisor made it clear who his priorities are today – not a plan for growth, a plan to reward the already wealthy,” said Shade Advisor Rachel Reeves.

Meanwhile, the Child Action Poverty Group said it was a “1 per cent” statement that said “more about bankers’ bonuses than helping hungry children.”

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No distributional analysis of ‘massive tax cuts for wealthier families’

The head of a think-tank said there was no distribution analysis from the government this time around on announced policies…

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Labor says the small budget is a ‘bonus for the already wealthy’

Earlier in Parliament, the shadow chancellor criticized the mini-budget as benefiting the rich.

“The chancellor made his priorities clear today — not a plan for growth, a plan to reward the already wealthy,” said Rachel Reeves. “Back to the fallout from the past, back to the future, not to a brave new era.”

She added: “If you’re a retiree worried about the cost of living, or if you’re a working family who sees your mortgage rate going up, or a small business growing in costs, today’s government announcements do nothing to reassure them.

“Bigger bonuses for bankers, huge profits for energy giants, shamelessly protected by Downing Street, and all the time ministers pile the overwhelming burden of all these costs on the taxpayers.”

Rachel Reeves Says Mini-Budgeting Is ‘Bonus for the Really Rich’

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(Parliament TV)

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Full story: Planned hike to alcohol duty canceled

Kwasi Kwarteng scrapped a planned increase in alcohol levies in his mini-budget as he made plans for billions of pounds in tax cuts and more borrowing, Matt Mathers Writes.

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Chart: Pound falls after mini budget

We mentioned that the pound fell to its lowest level in 37 years after the mini budget earlier.

This graph shows how it went down:

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Full story: Kwarteng announces stamp duty cuts

Kwasi Kwarteng has scrapped stamp duty on homes worth up to £250,000 in a bid to boost the property market, Andrew Woodcock reports.

The chancellor said his move – effective immediately – would get 200,000 people out of stamp duty altogether:

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The main points of the mini budget

Despite the name, Mini Budget has announced very few changes in the UK.

Here is an overview of the most important ones:

  • Eliminate the highest rate of income tax for those with higher incomes. Those making more than £150,000 a year would not pay the 45 per cent but instead, the lowest 40 per cent rate would apply to those over £50,271
  • Canceling the limit on bankers’ bonuses
  • Planned increase in corporate tax canceled
  • Lower the basic rate of income tax forward
  • Stamp duty reduced which means 200,000 people will pay home purchase tax
  • Introducing VAT-free shopping to foreign visitors
  • Legislation to force labor unions to submit wage offers to a member vote so that strikes can only be called after negotiations have collapsed completely
  • Confirm plans to have approximately 120,000 additional people in the universal credit program take active steps to seek more and better paid work or face a reduction in their benefits
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Tens of billions of dollars in tax cuts

The government’s mini-budget is estimated to contain a total tax cut of £45 billion by 2026-27, according to figures published by the Treasury.

Government estimates also suggest that the tax cuts in 2023-24 will be worth around £27 billion.

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Greens say UK is in the midst of ‘inequality economics’

Caroline Lucas of the Green Party said the UK faces “economic inequality” after the mini-budget.

“This isn’t a budget to tackle a cost-of-living scandal, an energy bills crisis, or a climate emergency — it’s a budget of free cash giveaways to fat cats and city bankers, and crumbs on the table for everyone else,” he said.

Caroline Lucas says budgeting leaves “crumbs on the table” for most people

(Getty Images)

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‘This was a statement for the 1 percent,’ says charity.

After the mini-budget, Child Poverty Action Group’s Alison Garnham said: “Despite his rhetoric about supporting families, this was actually a statement for the 1 percent, saying more about bankers’ bonuses than helping hungry children.”

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Stamp duty discounts

Kwasi Kwarteng has announced the abolition of stamp duty on homes worth up to £250,000 in his mini budget.

Kwasi Kwarteng announces the abolition of stamp duty on homes worth up to £250,000

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