• Shader Saidi

Personal tax

One widely made suggestion was to dispense with the health and social care levy (or at least its precursor the temporary National Insurance contributions (NIC) rate increase from April 2022). That hasn’t happened.

Instead, from July 2022, the NIC primary threshold and lower profits limit will increase by £2,690 to £12,570 bringing it into line with the income tax personal allowance for 2022–23. This will mean that approximately 70% of workers will pay less NIC overall. There is no relief for shareholders facing higher rates of income tax on dividends though.

If this was a pleasant surprise for those listening to the Speech, the Chancellor capped it at the end. Reminding us that his ‘over-arching’ desire was to see taxes fall by the end of this Parliament; he announced that, from April 2024, the basic rate of income tax will fall from 20% to 19%.

The Scottish Government will receive equivalent funding.

He also promised by 2024 to simplify the tax system by dealing with the over 1,000 tax reliefs and allowances. Not the first time that has been mentioned by a Chancellor.

The Government has published a Personal Tax Factsheet.

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