Watch mini-budget latest LIVE: Kwasi Kwarteng set to announce tax cuts for millions



K

wasi Kwarteng has taken to the despatch box to unveil a mini-budget expected to include billions of pounds of tax cuts.

The Chancellor has announced sweeping moves intended to rev up the economy in the “fiscal event” which started at 9.35am.

The Government is dubbing it a “growth plan” at a time when the UK faces a cost-of-living crisis, recession, souring inflation and climbing interest rates.

The Chancellor told MPs the planned rise to corporation tax would be canceled as he announced the cap on banker bonuses would be scrapped.

He also announced that the basic rate of income tax would be cut to 19% from April 2023 – a year earlier than planned.

The Chancellor already confirmed ahead of his mini-budget that the national insurance hike introduced by Boris Johnson’s government to pay for social care and tackling the NHS backlog will be reversed.

He is also set to ax the planned increase in corporation tax from 19% to 25%, and scrap the cap on bankers’ bonuses as part of wider city deregulation.

It has also been reported that he will cut stamp duty in a further attempt to drive growth.

Proposals to fast-track a scheduled 1p cut to income tax and to slash VAT from 20% to 15% across the board are reportedly also being considered.

Live updates

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Kwarteng confirms reversal of national insurance increase

The Chancellor has repeated his confirmation that the national insurance rise will be reversed.

He estimates that this will save people on average, £330 every year, a tax cut for 28 million people.

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Planned alcohol duty rises will be canceled

The Chancellor says planned increases on wine, beer, and other alcohol duties will be cancelled.

“At this difficult time, we are not going to let alcohol duty rates rise in line with RPI [inflation]”, he says.

“So I can announce that the planned increases in the duty rates for beer, for cider, for wine, and for spirits will all be canceled.”

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VAT-free shopping for tourists, says Chancellor

Mr Kwarteng tells MPs that overseas visitors will have VAT-free shopping.

“Britain welcomes millions of tourists every year, and I want our high streets and airports, our ports and our shopping centers, to feel the economic benefit,” he said. “So we have decided to introduce VAT-free shopping for overseas visitors.”

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Kwarteng confirms cancellation of planned increase in Corporation Tax

Mr Kwarteng confirms the Government will drop a planned increase in corporation tax to 25%, meaning it will instead stay at 19%.

He said: “Every additional tax on business is ultimately passed through to families through higher prices, lower pay, or lower returns on savings.”

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Kwarteng confirms scrapping of bankers’ bonus cap

The Chancellor has confirmed trailered plans to scrap a cap on bankers’ bonus.

He tells MPs the cap only pushed up the basic salaries of bankers and scrapping it will encourage global banks to invest in the UK.

“All the bonus cap did was to push up the basic salaries of bankers, or drive activity outside Europe. It never capped total remuneration, so let’s not sit here and pretend otherwise,” he said. “So we’re going to get rid of it”.

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Kwarteng: Govt will toughen rules to stop ‘militant’ trade unions closing down transport networks

The Chancellor tells MPs that the Government will introduce “minimum service levels” in a bid to stop “militant” trade unions closing down transport networks.

He also says that the Government will legislate “require unions to put pay offers to a member vote, to ensure strikes can only be called once negotiations have genuinely broken down.”

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Kwarteng: Planning reform to help infrastructure projects off the ground

Mr Kwarteng pledges an overhaul of planning rules surrounding nationally important infrastructure projects to get them off the ground.

He announces a new bill “to unpick the complex patchwork of planning restrictions and EU-derived laws that constrain our growth”.

He tells MPs: “Today, we are publishing a list of infrastructure projects that will be prioritised for acceleration, in sectors like transport, energy, and telecoms.

“And, to increase housing supply and enable upcoming planning reforms, we will also increase the disposal of surplus government land to build new homes”.

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Energy package will cost £60 billion for the six months – Kwarteng

Mr Kwarteng tells MPs Government’s energy support scheme will cost £6bn for six months.

He said: “The House should note that the estimated costs of our energy plans are particularly uncertain, given volatile energy prices.

“But based on recent prices, the total cost of the energy package, for the six months from October, is expected to be around £60bn. We expect the cost to come down as we negotiate new, long term energy contracts with suppliers.”

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Our aim is to reach growth of 2.5% – Kwarteng

Kwasi Kwarteng says the Government aims to reach an annual rate of 2.5% for growth,

“We need a new approach for a new era, focused on growth. Our aim, over the medium term, is to reach a trend rate of growth of 2.5%.” he said.

“And our plan is to expand the supply side of the economy through tax incentives and reform.”

He says this will be focussed on three priorities, maintaining responsible public finances, reforming the supply-side of the economy and cutting taxes to boost growth.

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Kwasi Kwarteng starts mini budget ‘statement for growth’

Chancellor Kwasi Kwarteng has begun his mini budget in a statement to the Commons, saying “help is coming” for households and businesses with soaring energy costs.

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