The much-anticipated Autumn Statement was finally made on November 17, when the chancellor unveiled plans for the future.
As we mentioned earlier in our article about the possibility of the Autumn Statement, taxes are pretty much the topic of focus.
In this article you will read about changes to tax and other financial plans and how they will affect you.
Spending Cuts
The Chancellor of the Exchequer mentioned the “economic storm” in his previous public remarks and pledged to face the crisis head on.
Affected by various aspects, the pound fell to the bottom in the previous period and then rose, although it still did not return to normal levels.
Government spending has always been balanced by revenue such as taxes, and the recent mini-budget directly upset the balance.
In the autumn statement, the chancellor confirmed that government spending would be tightened.
This will affect public services such as schools and the police, in addition to the NHS.
Minimum wage hike for some groups
Previously, the minimum wage for those over 23 was £9.50 an hour.
From April 2023, the minimum wage for over 23s will increase to £10.42 an hour.
Obviously, with the level of inflation and price increases, it will be difficult to hold the minimum wage through the long winter ahead.
Not only that, people’s real wages have been devalued in many ways, and even more money is being spent on the most basic food.
The threshold for the top rate of tax is reduced to £125,140
As of now, the income tax threshold for paying the top rate of 45p is £150,000.
The Autumn Statement that threshold to £125,140, meaning more people will start paying top income tax.
Those earning more than £150,000 will pay an extra £1,200 a year.
Not only that, the income tax personal exemption threshold will be frozen until 2028.
Windfall Tax
The windfall tax we mentioned earlier has been implemented in some countries, and the UK is still waiting to see the policy of increasing the windfall tax.
In the autumn statement, the windfall tax on the energy industry will rise from the current 25% to 35% until March 2028.
The increase in windfall tax will fill part of the fiscal hole for the government and ease inflation.
Capital Gains Tax
The annual allowance for capital gains tax will be cut from £12,300 to £6,000 next year.
After that, it will be cut to £3,000 from April 2024.
Energy Bills
In the previously announced mini-budget, the former prime minister froze the ceiling on energy bills at £2,500, which to some extent eased the heating crisis.
With gas prices continuing to soar, the current price cap won’t last long until the mini-budget U-turn.
The mini-budget U-turn revealed further plans for energy bills to freeze prices until April next year.
