Comments on the Chancellor’s Autumn Statement – 31 October 2022 17 November 2022
It seemed a world away from the comedy double act of Liz and Kwasi, listening and digesting today’s deferred Autumn Statement from the latest Tory Chancellor off the rank, Jeremy Hunt.
Whilst Kwasi Kwarteng’s mini-budget way back on 23 September promised the biggest package of tax cuts in about fifty years, NHS favourite Mr Hunt, having already reversed most of those proposals, has now proceeded to trample over the historic Conservative view of tax. I have copied and pasted the following paragraphs word for word from the Conservative party website as I compile this commentary:
Conservatives tax guarantee
We promise not to raise the rates of income tax, National Insurance or VAT. This is a tax guarantee that will protect the incomes of hard-working families across the next Parliament.
We not only want to freeze taxes, but to cut them too….Our ultimate ambition is to ensure that the first £12,500 you earn is completely free of tax – which would put almost £500 per year in people’s pockets.
Labour would bring economic disaster for Britain due to their extreme policies and we will all pay the price. They don’t know how to manage the economy and would make the wrong choices with your money. By hitting businesses with higher taxes and more red tape they would damage our economy.
Under Labour we would pay through higher taxes on everyone and less money for public services.
“Ah …” I hear you reply “none of the rates of income tax, VAT or national insurance have gone up. They are still as they were yesterday” Clearly that is true but by either fixing thresholds for extended periods or by halving capital gains tax and tax-free dividend allowances, as well as reducing the level at which 45% tax is paid, the Chancellor is achieving the same effect by stealth. Indeed, if the numerous unions balloting for strike action are successful in getting substantial pay rises for their members in the wake of the highest level of inflation in 40 years, then many more people will be dragged into being higher rate tax payers.
This isn’t a party political piece. I recognise that the Global economy as a whole is struggling not just the UK, following two years of the Covid pandemic and the Ukraine conflict. I also appreciate that at times like these it is easy to be in opposition, when you have free rein to criticise the Government at every turn without really ever having to put out a cogent plan of your own.
We need the detail behind the headline proposals before we can fully gauge the impacts on individuals and businesses, but the suspicion is that the small print is likely to reveal more bad news than good.
If you have any questions regarding the 2022 Autumn Statement and how the changes might affect you or your business, please get in touch.
Mike Carabine – Senior Manager