Mini budget: TAX CHANGES SCRAPPED

• The planned 1p cut in income tax will be deferred “indefinitely”. The Treasury advises this will save £6bn a year.
• Corporation tax will rise to 25% from 19% in April.
• A planned 1.25% cut to dividend tax has been abandoned. In the mini-Budget, Mr Kwarteng pledged to reverse a rise in dividend tax brought in by Rishi Sunak last April. The Government expects to save around £1bn a year by maintaining the tax at a higher rate.
• A freeze on alcohol duties has been scrapped. Ms Truss had planned to freeze the cost of booze from February next year. The about turn is worth approximately £600m a year.
• Changes to IR35 tax rules has been axed.
• VAT free shopping for tourists has also been ditched, which will save around £2bn a year.

Energy support

Mini budget: TAX CHANGES SCRAPPED

• The energy price guarantee will only remain universal until April. It will then become targeted and capped, meaning it will be limited to just some households from then on. Under original plans, it was supposed to be a universal support package lasting two years.
• The Treasury said it would be “irresponsible” for the government to continue “exposing the public finances to unlimited volatility in international gas prices”.
• Ministers will launch a review to consider how to support households and businesses with energy bills after April 2023.
• It said the objective of the review is “to design a new approach that will cost the taxpayer significantly less than planned whilst ensuring enough support for those in need”.