Welcome to the 2022 Autumn Statement Newsletter from Walsh & Co
Tax burden rises following Autumn Statement
The UK's tax burden will rise after Chancellor Jeremy Hunt reduced the threshold on the top rate of tax and announced freezes on other taxes in the Autumn Statement.
The threshold for the top 45% additional rate of income tax was cut to £125,140 from £150,000.
Mr Hunt also froze the thresholds on the income tax personal allowance, income tax higher rate, basic national insurance and inheritance tax (IHT) for a further two years until April 2028.
The Dividend Allowance will be reduced from £2,000 to £1,000 next year and £500 from April 2024.
In addition, the capital gains tax exemption will be reduced from £12,300 to £6,000 next year and then to £3,000 from April 2024.
As energy prices continue to drive inflation, the Chancellor confirmed that the Energy Price Guarantee will be extended for a year from April 2023. However, the level at which typical bills are capped will increase to £3,000 a year from £2,500.
The windfall tax on the profits of oil and gas firms was increased from 25% to 35% and extended until March 2028.
The Chancellor also announced a £13.6 billion package of support for business rates payers in England. To protect businesses from rising inflation, the multiplier will be frozen in 2023/24, while relief for 230,000 businesses in the retail, hospitality and leisure sectors was also increased from 50% to 75% next year.
Mr Hunt also confirmed the National Living Wage (NLW) will rise from £9.50 to £10.42 an hour, while the triple lock on state pensions was protected.
The Chancellor said: 'There is a global energy crisis, a global inflation crisis and a global economic crisis. But today with this plan for stability, growth and public services, we will face into the storm. Because of the difficult decisions we take in our plan, we strengthen our public finances, bring down inflation and protect jobs.'
For a detailed overview of the 2022 Autumn Statement and what the measures mean for you and your business, visit our Autumn Statement summary.
WHAT THEY SAID
'Today with this plan for stability, growth and public services, we will face into the storm.'
Jeremy Hunt, Chancellor of the Exchequer
'The Conservatives have picked the pockets of purses and wallets of the entire country, as the Chancellor has deployed a raft of stealth taxes, taking billions of pounds from working people.'
Rachel Reeves, Shadow Chancellor of the Exchequer
'On taxes, we've got some reasonably significant tax rises, certainly on energy companies, on employers and on people with high incomes and income from wealth.'
Paul Johnson, Director General of the Institute for Fiscal Studies
'Businesses will look at [the] announcements and welcome support with business rates and the retention of the employment allowance, though the reduction in the dividend allowance will impact many smaller firms.'
Shevaun Haviland, Director General of the British Chambers of Commerce
'While tackling inflation is essential, so are measures to create conditions for prosperity, growth and support enterprise.'
Martin McTague, National Chair of the Federation of Small Businesses
For the full Autumn Statement documents visit:
https://www.gov.uk/government/topical-events/autumn-statement-2022
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