Chancellor announces £45bn of tax cuts

The Chancellor of the Exchequer Kwasi Kwarteng has announced £45 billion of tax cuts in a ‘mini’ budget set to cost the exchequer around £100bn.

The Chancellor of the Exchequer Kwasi Kwarteng has announced £45 billion of tax cuts in a ‘mini’ budget set to cost the exchequer around £100bn.

Kwarteng moved to axe the additional 45% income tax band, cut the basic rate of income tax to 19%, scrap plans for a hike in corporation tax, reverse next April’s planned 1.25% National Insurance increase and abolish a cap on bankers’ bonuses in what has been described as the biggest tax cutting event since 1972.

The cost of Kwarteng’s bid to address UK inflation of 9.9% and boost the economy is estimated by the Institute of Fiscal Studies (IFS) to be around £37bn in the next financial year.

That total excludes the estimated £60bn already committed to tackle soaring energy prices by capping the average household energy bill to £2,500 and handing businesses an energy price guarantee for the next six months.

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