Susie Walker

The Chancellor confirmed the UK is in recession and accordingly produced an Autumn Statement in which everyone feels the pain, taking more from those who earn more to finance a more self-sufficient version of the UK with focussed investment in education and the NHS.

More people will now pay the top 45% additional rate of income tax south of the border after the earnings threshold was reduced from £150,000 to £125,140. We’ll need to await the Scottish budget next month to find out what this means for income tax rates for Scottish taxpayers. It feels likely that as a minimum this will be mirrored.

The annual exempt amount for capital gains tax is to be cut from next year, reducing from £12,300 to £6,000 then £3,000 from April 2024 and millions of households face bigger energy bills with the energy cap rising to £3,000 instead of £2,500. The big tax raising change for corporates announced today was the widely anticipated tax on energy firms, who’ll face a bigger tax bill for UK operations after the windfall tax was announced to increase from 25% to 35%.

Assuring the nation that Britain is not alone in facing economic headwinds, he said his three priorities were stability, growth and public services. His ambitions for the country also break down into three key areas – energy security, infrastructure and innovation - with the Chancellor saying he wants Britain to be the next ‘Silicon Valley’.

Despite this, he stated that R&D tax relief reform is on the way following abuse of the regime with the SME rate being cut. It’s unfortunate that the ‘bad’ claimants pull back this highly valuable relief for all. The proposed new road tax on electric vehicles from 2025, which caused a flurry of enquiries from clients, is another example of how everyone must pay the price for taking control of inflation, no questions asked.

Not included in his speech but very clear in the full government document is a renewed focus by HMRC on tax avoidance and tackling fraud.

Jeremy Hunt’s Statement is very different to the one delivered by his predecessor, but he was clear that he’d engaged with the OBR and the Bank of England before standing up today. There remains a focus on growth, as long as we take the pain now and the recovery is made here in Britain.