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Autumn Budget 2022
New Chancellor, Jeremy Hunt has announced his Autumn Budget and says the government will deliver a plan to tackle the cost of living crisis and rebuild the UK economy. His priorities are stability, growth and public services, and is providing “fair solutions” despite taking “difficult decisions”.
Chancellor unveils a plan for stability, growth, and public services with tackling inflation top of the priority list, to stop it eating into paycheques and savings, and disrupting business growth plans.
To protect the most vulnerable the Chancellor unveiled £26 billion of support for the cost of living including continued energy support, as well as 10.1% rises in benefits and the State Pension and the largest ever cash increase in the National Living Wage.
Necessary and fair tax changes will raise around £25 billion, including an increase in the Energy Profits Levy and a new tax on the extraordinary profits of electricity generators.
Decisions on spending set to save £30 billion whilst NHS and Social Care get access to £8 billion and schools get an additional £2.3 billion reflecting people’s priorities. -To deliver prosperity, he’s also committed to infrastructure projects including Sizewell C and Northern Powerhouse Rail, along with protecting the £20 billion R&D budget.
Key announcements will be published on this page and Budget coverage will be in the forthcoming issue of International Accountant magazine. AIA Members in Practice also have full access Tolley Tax Library and Online Seminars where all the announcements will be reflected.
Tax Card 2022/23
Announcements from the Autumn Budget 2022
Here's a quick guide to the main announcements from the Autumn Budget:
Taxation and Wages
UK minimum wage for people over 23 to increase from £9.50 to £10.42 an hour
Top 45% additional rate of income tax will be paid on earnings over £125,140, instead of £150,000
Income tax personal allowance and higher rate thresholds frozen for further two years, until April 2028
Main National Insurance and inheritance tax thresholds also frozen for further two years, until April 2028
Tax-free allowances for dividend and capital gains tax also due to be cut next year and in 2024
Household energy price cap extended for one year beyond April but made less generous, with typical bills capped at £3,000 a year instead of £2,500
Households on means-tested benefits will get £900 support payments next year
£300 payments to pensioner households, and £150 for individuals on disability benefit
Windfall tax on profits of oil and gas firms increased from 25% to 35% and extended until March 2028
New "temporary" 45% tax on companies that generate electricity, to apply from January
Economy and Public Finances
The Office for Budget Responsibility judges UK to be in recession, meaning the economy has slowed for two quarters in a row
It predicts growth for this year overall of 4.2%, but size of the economy will shrink by 1.4% in 2023
Growth of 1.3%, 2.6%, and 2.7% in 2024, 2025 and 2026
UK's inflation rate predicted to be 9.1% this year and 7.4% next year
Unemployment expected to rise from 3.6% to 4.9% in 2024
Government will give itself five years to hit debt and spending targets, instead of three years currently
Defence spending to be maintained at 2% of national income - a Nato target
Overseas aid spending kept at 0.5% for the next five years, below the official 0.7% target