Future Retirement Success
  • Politics
  • Business
  • Investing
  • Stocks
  • Politics
  • Business
  • Investing
  • Stocks

Future Retirement Success

Business

Chancellor Jeremy Hunt delays 1p income tax cut

by October 15, 2022
October 15, 2022
Chancellor Jeremy Hunt delays 1p income tax cut

Jeremy Hunt is to delay a penny cut in income tax, the flagship announcement in the disastrous mini-budget, to help plug a black hole in the public finances that had reached £72 billion.

In the latest in a series of government U-turns, the new chancellor is expected to announce that plans to reduce the basic rate of income tax next April will be pushed back by a year.

The cut to 19 per cent will now take effect at the time previously proposed by Rishi Sunak, the former chancellor, who was Liz Truss’s leadership rival. The cut will save 31 million taxpayers up to £360 a year.

The delay is expected to save the Treasury £5 billion a year as Hunt tried to deal with an economic outlook that government sources have revealed is “far worse” than had been predicted.

A source familiar with the discussions between the Treasury and Office for Budget Responsibility (OBR) confirmed that the watchdog had warned in its draft forecast that by 2027-28 there would be a black hole in the public finances of up to £72 billion.

Even after the U-turns on the additional rate of income tax and corporation tax, which will raise £20 billion, the Treasury still faces a shortfall of up to £52 billion.

Hunt, who replaced Kwasi Kwarteng as chancellor on Friday, will meet Richard Hughes, chairman of the OBR, on Monday, as he begins ripping up Truss’s economic policy. He is understood to be reviewing every aspect of Kwarteng’s fiscal statement before he delivers his first “proper budget” on October 31.

“Everything is on the table,” said a source close to the chancellor. “He is going to be delaying tax cuts as well as overseeing more aggressive cuts to public spending — more than was previously planned. What the prime minister wants him to do is send a very strong signal that the numbers add up and that has to get the support of the OBR and the Bank of England. The Bank is important because they are going to have to make a decision about raising interest rates just three days after the next budget.”

A Tory who has discussed the plans with senior figures in Downing Street said: “Jeremy thought [Truss] needed to U-turn on more than corporation tax. He thinks we need to be way more open to doing more. Kwasi also did the dividend tax cut, 19p, IR35 [tax avoidance legislation]. That’s a lot of billions going out of the door.”

This morning Hunt warned that alongside reconsidering Truss’s remaining tax cuts, “[government] spending will not go up as much as people want and there’ll be more efficiencies to find”.

He is now understood to be poring over Whitehall spending. A leaked document suggests that as of last week the Treasury had been looking to claw back up to £8 billion from departmental budgets.

The plans are contained in a letter drawn up by Treasury ministers before Kwarteng’s sacking and had been due to be sent to cabinet ministers on Monday.

The letter states Whitehall departments should by late November identify options for “stopping” either “low-value” or “low-priority” programmes worth between 10 and 15 per cent from their capital budgets over the next two financial years, of which half would be reallocated to higher-priority programmes and managing the pressures created by inflation.

Read more:
Chancellor Jeremy Hunt delays 1p income tax cut

0
FacebookTwitterGoogle +Pinterest
previous post
Wawa to Close Two Philly Locations Citing ‘Safety and Security Challenges’ After Flash Mobs Ransack Store (VIDEO)
next post
BMW moves Mini production out of Britain in bitter blow for UK’s electric car ambitions

You may also like

Amazon, Glassdoor and Trustpilot unite to fight fake...

October 19, 2023

Ministers consider renationalising British Steel to save thousands...

December 4, 2024

Government injects £75m into regional innovation hubs

October 24, 2023

How to Boost Employee Morale with Thoughtful Corporate...

June 11, 2025

UK vacuum cleaner innovators secure six-figure investment in...

November 3, 2022

Its time to inject yourself into the thick...

September 16, 2022

Deliveroo CEO Will Shu sells £15m worth of...

September 17, 2024

English Wine Producers Anticipate Bumper Harvests Following July...

August 12, 2023

Reeves faces tough choices as fiscal headroom vanishes,...

February 12, 2025

Advanced Poker Strategies – How to Become a...

December 19, 2022

    Get free access to all of the retirement secrets and income strategies from our experts! or Join The Exclusive Subscription Today And Get the Premium Articles Acess for Free

    By opting in you agree to receive emails from us and our affiliates. Your information is secure and your privacy is protected.

    Recent Posts

    • Brazil’s ex-president and major Trump ally Bolsonaro placed on house arrest

      August 6, 2025
    • Marjorie Taylor Greene urges Trump to commute George Santos’ federal prison sentence: ‘Far worse offenses’

      August 6, 2025
    • RFK Jr cancels $500 million in mRNA research, HHS to prioritize ‘safer’ vaccine alternatives

      August 5, 2025
    • Senate GOP ready to go nuclear after Schumer’s ‘political extortion’ of nominees

      August 5, 2025
    • Cotton calls on IRS to pull Muslim advocacy group’s nonprofit status

      August 5, 2025
    • One in Five ICE Arrests Are Latinos on the Streets with No Criminal Past or Removal Order

      August 5, 2025

    Categories

    • Business (8,677)
    • Investing (2,174)
    • Politics (16,315)
    • Stocks (3,228)
    • About us
    • Privacy Policy
    • Terms & Conditions

    Disclaimer: futureretirementsuccess.com, its managers, its employees, and assigns (collectively “The Company”) do not make any guarantee or warranty about what is advertised above. Information provided by this website is for research purposes only and should not be considered as personalized financial advice. The Company is not affiliated with, nor does it receive compensation from, any specific security. The Company is not registered or licensed by any governing body in any jurisdiction to give investing advice or provide investment recommendation. Any investments recommended here should be taken into consideration only after consulting with your investment advisor and after reviewing the prospectus or financial statements of the company.

    Copyright © 2025 futureretirementsuccess.com | All Rights Reserved