Kwasi Kwarteng has ‘stepped aside’ from his position as Chancellor of the Exchequer, replaced by former foreign secretary Jeremy Hunt, less than a month after his disastrous mini-budget which has seen the government perform u-turn after u-turn.
The mini-budget included several changes to taxation and fiscal policy, so here’s a quick run down on what was changed, and what has been reversed so far.
Income Tax
The basic rate of income tax was cut to 19% from 20% and would be effective from April 2023.
Those individuals on a higher tax band had their tax rate cut to 40% from 45%, although this has already been reversed.
National insurance
National insurance had risen in April, with workers and employers paying an extra 1.25p in the pound.
This decision has been reversed and was announced in the mini-budget.
Plans for a new Health and Social care levy to pay for the NHS, however, will not go ahead.
Corporation tax
Corporation tax was set to decrease to 19% from 25% in April 2023.
However, this received large swathes of criticism, and Prime Minister Liz Truss has reversed this decision, which Truss claims will raise £18bn in a speech today.
Stamp duty
A cut to stamp duty, which is paid when people buy property in England and Ireland, was announced in the budget.
No stamp duty on the first £250,000 when buying a house, which rises to £425,000 for first-time buyers, which came into effect today.
Bankers’ bonuses
Bankers’ bonuses, which have more than doubled since the 2008 financial crash, had their limits scrapped.
Benefits
Rules regarding universal credit (UC) were tightened in the budget, meaning some 120,000 people claiming UC had to take more active steps to seek work or face a reduction in their benefits.