The 'mini-Budget' announced by Kwasi Kwarteng was anything but. Headline grabbing tax cuts for individuals and business are likely to add up to the biggest tax cuts in at least a generation as Liz Truss and her new government team bet on trickle down economics revitalising the economy.
Our main coverage can be found here:
Chancellor announces £45bn of tax cuts
Bonds and sterling sell off in response
Income tax and stamp duty slashed
Government counting on low tax zones to boost regional growth
Government scraps dividend tax increase ahead of mini-budget
Beyond these headlines there were other highlights:
Help for the boozers
The government has axed planned increases to alcohol duty rates in welcome news for both purveyors and drinkers. The chancellor also confirmed that draught relief will be extended to cover kegs from 20 litres, and there will be an 18-month transition period for wine tax changes. CA
New VAT-free tourist scheme
In a boost for the retail and travel sectors, the chancellor announced a new VAT-free shopping scheme for tourists. Visitors to Great Britain will be able to get a VAT refund on items purchased and then taken abroad. This applies to items bought on the high street, and at airports and other departure locations. CA
VCTs and EIS life extended
The chancellor also announced an extension to tax relief on investment vehicles such as Venture Capital Trusts (VCTs) and Enterprise Investment Schemes (EIS) . Such schemes had been subject to a sunset clause which meant they would not qualify for tax relief beyond 2025. Today the chancellor announced that the sunset clause will be scrapped.
Pension charges cap reform to go ahead
The government will proceed with plans to reform a charge cap on defined contribution pension schemes in a bid to allow greater investment in illiquid assets that can currently fall foul of the rules by incurring performance fees.
It has also introduced the Long-Term Investment for Technology & Science competition, providing up to £500mn to “support new funds designed to catalyse investment from pension schemes and other investors” into the space. DB
