It was billed as a ‘mini-budget’, but Friday’s package of tax cuts was anything but.

The Chancellor, Kwasi Kwarteng, has unveiled his Growth Plan, setting out a raft of changes aimed at “tackling high energy costs and inflation and delivering higher productivity and wages”.

And while the measures will be welcomed by many, others have warned the radical change of direction is a big gamble that puts the economy and public finances at further risk. There’s also criticism there isn’t enough help for people struggling with the cost of living.

Here, we look at the key measures in the mini-budget…

Income tax

  • The basic rate of income tax will be cut by 1p, taking the rate down to 19% from April 2023 (a year earlier than planned). The Government estimates this will give 31 million people an average of £170 a year more.
  • Plus, the 45% higher rate of income tax has been abolished. So, there will be one single higher rate of the tax of 40% from April 2023.

Corporation tax

  • The planned rise in corporation tax has been cancelled, keeping it at 19%.

National Insurance

  • The 1.25 percentage point rise in National Insurance contributions is being reversed.
  • The NI rates will be reduced from 6 November, in effect removing the temporary 1.25 percentage point increase for the rest of the 2022-23 tax year.
  • The 1.25% Health and Social Care Levy won’t come into force as a separate tax from 6 April 2023 as previously planned.

Stamp duty

  • The nil rate band of Stamp Duty Land Tax (SDLT) has been doubled from £125,000 to £250,000. The Government claims this will enable 200,000 more people a year to buy a home without paying the tax.
  • First-time buyers, meanwhile, will pay no stamp duty up to £425,000. Plus, the value of the property on which they can claim the relief has been increased from £500,000 to £625,000.

Work and investment

  • The Annual Investment Allowance stays at £1 million. The allowance gives 100% tax relief to businesses when they invest in plant and machinery, up to the higher £1 million limit.
  • The Government is in talks with 38 local authorities to set up ‘Investment Zones’ in England. It also plans to work closely with the devolved administrations and local partners to deliver these in Scotland, Wales and Northern Ireland. Each zone will offer targeted and time-limited tax cuts for businesses, and liberalised planning rules to release more land for housing and commercial development.
  • The 2017 and 2021 reforms to the off-payroll working rules (also known as IR35) will be repealed from 6 April 2023. From this date, workers across the UK providing their services via an intermediary will once again be responsible for determining their employment status and paying the appropriate amount of tax and NICs.


  • Universal Credit claimants who earn less than the equivalent of 15 hours a week at National Living Wage will have to meet regularly with their work coach and take active steps to increase their earnings or face having their benefits reduced.
  • Jobseekers over the age of 50 will be given extra time with Jobcentre work coaches, to help them return to work.

(Note: most of the announcements are UK-wide but there are some variations for Scotland, Wales and Northern Ireland.)

How much will the measures cost?

The economic effects of the Growth Plan will be assessed by the Office for Budget Responsibility when it publishes a forecast before the end of the year. This forecast will include the consequences for tax receipts, spending, Government borrowing and debt.

The Chancellor’s view

Mr Kwarteng said his plan would mean “more jobs, higher pay and more money to fund public services, like schools and the NHS”.

He added: “This will not happen overnight but the tax cuts and reforms I’ve announced today – the biggest package in generations – send a clear signal that growth is our priority.

“Cuts to stamp duty will get the housing market moving and support first-time buyers to put down roots. New Investment Zones will bring business investment and release land for new homes in communities across the country. And we’re accelerating new road, rail and energy projects by removing restrictions that have slowed down progress for too long.

“We want businesses to invest in the UK, we want the brightest and the best to work here and we want better living standards for everyone.”

Our reaction to the mini-budget

Given the current state of the economy, it’s no surprise the Chancellor has delivered a series of tax cuts. But whether the measures are enough to breathe life back into the economy remains to be seen. However, they will be welcomed by many.

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Steph Churchill

Stephanie Churchill

Managing director & co-owner of Churchill Taxation