Giving his business-focused Autumn Statement, chancellor Jeremy Hunt said he was "removing barriers to investment and rewarding work".
Stating that he was looking to improve business taxation to "back British business with 110 growth measures" - though he promised not to go through them all at the despatch box - Hunt said he was not going to "take risks with inflation".
This was important to help getting people back into the workplace and making it easier for businesses to operate and grow in the UK, Hunt said.
"Looking ahead, the OBR expects the economy to grow 0.7 per cent in 2024", he said, pointing to growth of 1.4 per cent expected for 2025, based on Office for Budget Responsibility predictions.
But Hunt warned: "If we want those numbers to be higher, we need higher productivity", which is why his 110 growth measures will be important plans to put in place to help drive the UK economy.
"I've delivered the biggest British business tax cut in history", he boasted.
But let us have a look at what the biggest tax changes were this time round for individuals and for businesses.
That's right: it's time for the FT Adviser tax table to stage a comeback after a record year for it last year (2022), when it appeared no less than four times, like a series of straight-to-video movie sequels.
| 2023 Autumn Statement | Budget 2023 | 2022 Autumn Statement (Hunt's first one in October 2022, not the September one from He That Shall Not Be Named) | |
Income tax and personal allowances | Abolishing Class 2 NICs for self-employed people, saving the average SE person £192 a year. Reducing Class 4 NICs by 1 per cent. Cut main rate of employee national insurance to 10%.
Income tax bands remain frozen til 2027 | The lower rate is expected to come into force this April. The threshold of income at which qualifying carers begin paying tax on care income will be increased to £18,140 per year plus £375 to £450 per person cared for per week for 2023-24. Thresholds will then be index linked. | Lowering the additional tax rate threshold from £150,000 to £125,000. Other personal thresholds frozen until 2028. |
| Dividend tax | - Previously announced reductions to go ahead. | Dividend threshold to lower from £2,000 to £1,000 next year, then to £500 from April 2024. | |
Pension allowances | Commitment to the triple lock, meaning an extra £900 a year per person after April next year (2024). | No more lifetime allowance - it will be abolished completely in a future Finance Bill. Annual Allowance set to rise from £40,000 to £60,000.MPAA set to revert to £10,000 from £4,000.PCLS will be retained at £268,375 & frozen thereafter. | LTA thresholds remain frozen, as does MPAA and PLA. Increasing pension credit for poorest pensioners. Will also protect the triple lock. This means Pension credit and state pension going up 10.1%. |
Capital gains tax | - | Tighter rules around disclosure of disposal of assets under conditional contracts to allow HMRC more time to assess tax due on capital gains. | CGT exemption to decrease from £12,300 to £6,150 next year, then £3,000 in April 2024. |
| Bank levy | - | From April 2023, banks will be charged an additional 3% rate on their profits above £100mn; £280mn will be invested in the Department of Work and Pensions to crack down on benefit fraud and errors. | |
| Inheritance tax | No reforms | No uplift for IHT thresholds; current freeze remains. | The freeze on the IHT threshold remains for both the nil-rate band and residential nil-rate bands to 2028 |
| Corporation tax | Honouring the commitment to help companies investing in the UK by making full expensing permanent. | Corporation tax will still rise to 25% from 19% as planned but super deduction being replaced with "full capital expensing" for 3 years to try and support businesses. | - |
Tax on savings interest | Simplifying Isa regime, digitalising the reporting scheme and allowing the IFISA to invest in long-term asset funds and open-ended property. Subscription limits remain across the range. Fractional shares allowed; | Maintaining limits on Isas. | No changes to EIS. |
National Insurance contribution | Abolishing Class 2 National Insurance contributions for self-employed people, saving the average SE person £192 a year. Reducing Class 4 NICs by 1 per cent. | - Commitments to help self-employed and lower earners | - |
| VAT | Duty on alcohol frozen until August 1 2024. | - | |
Stamp Duty Land Tax | Extending the growth market exemption, a relief from stamp duty and stamp duty reserve tax to include "smaller, innovative growth markets" in- January 2024. | Changes will only last until 2025. For current homeowners, SDLT will be payable above £250,000 and fall back to £125,000 in 2025. | |
Environmental taxes and energy support for homeowners | Climate Change Levy - maintaining freeze. Reduced rates from one year from April 2025. | The Energy Price Guarantee will be kept at £2,500 for an additional three months from April to June, saving a typical household £160.End to the energy premium paid by households who use pre-payment meters, which will save 4mn families £45 a year from July. | From January 1 to March 28, levy will rise from 25% to 30%; From January 1 new temporary 45% levy on electricity generators. |
Business rates and Restart | Freeze small business multiplier for a further year. Extend the 75 per cent business rates discount for retail, hospitality and leisure for another year. | Enhanced credit for R&D of £27 for every £100 spent on R&D.Small businesses investment allowance increased to £1mn. | Proceeding with the revaluation of business properties from April 2023, but there will be a tax cut over the next five years and the introduction of a new relief scheme. |
Entrepreneurs' relief (Business Asset Disposal Relief); R&D and R&D Expenditure Credit | Merging R&D Expenditure Credit and SME schemes from April 2024. Reducing rate at which loss-making companies are taxed from 25% to 19%. | No changes to R&D and will publish a decision on Solvency II to unlock development for growing British companies. | |
Health and Social Care tax | - | - | DWP and NHS will publish a plan for the number of health pros UK will need in 5, 10 and 15 years' time. Council taxes freed to rise up to 5% over next two years to cover social care costs. |
Residential Property Development Tax and Mortgage scheme. | Government will extend the mortgage guarantee scheme for an additional 18 months until the end of June 2025. | Pledge to implement Edinburgh reforms regarding real estate investment trusts. Extension to the mortgage guarantee scheme. | - |
Employment Allowance relief | More guidance expected to help self-employed | - | |
| IR35 | Autumn Finance Bill 2023 will allow HMRC to reduce the pay-as-you-earn liability of a deemed employer to account for taxes paid by a worker and their intermediary on payments received, where an error has been made in applying the off-payroll working rules. | As outlined in Hunt's turnaround Budget in October 22, there will now be no reversal of off-payroll working reforms introduced in 2017 and 2021. The original changes will go ahead as planned. | - |
Childcare benefit | Continuation of Budget pledges | Childcare support will come up-front. The limit on maximum support will rise after being frozen at £646 a month for years.The 30 hours' free childcare per week for 38 weeks support will be extended to one- and two-year-olds from September 2024. | - |
Pushing people on Universal Credit back to work | Mandating a work programme to help unemployed back to work; those who do not engage with this will have benefits stopped after six months. | Strengthened work search requirements are expected to encourage over 700,000 lead carers of children on Universal Credit to look for work or increase their hours.The administrative Earnings Threshold will be increased from the equivalent of 15 to 18 hours of earnings at the National Living Wage for an individual claimant. The couples AET will be removed entirely.This is expected to ask over 100,000 additional claimants to meet more regularly with a Work Coach and take active steps to move into work or increase their earnings. | - |
Tax Avoidance | New powers to DWP to tackle fraud and error. Tougher consequences for promoters of tax avoidance schemes. | Tougher measures to crack down on tax avoidance and tax avoidance schemes. The government will double the maximum sentences for the most egregious cases of tax fraud from 7 to 14 years. | - |
Together with a freeze on all alcohol duty until August 1 2024, just in time for my birthday (thanks, Jeremy), he pledged this would help boost Britain's small pub landlords as well as people who have found the price of a pint "more expensive" amid the cost-of-living crisis.
simoney.kyriakou@ft.com
