The naughty and nice taxes of Autumn Budgets past 

  • 4 min read
  • 6 Nov 2023

When the sky turns grey and the leaves brown, most of us take it as a sign to go into hibernation. 🐻

That’s everyone but the Chancellor of the Exchequer. Because as the sun fades, it’s their turn to shine (or not). ⛅

With this year’s spotlight firmly on Jeremy Hunt, we thought we’d see how his Autumn Budget might fare against his predecessors using a system we like to call ‘naughty’ or ‘nice’ taxes.

But first, what is the Autumn Budget?

Unlike the real thing, we’ll keep this brief. The Autumn Budget is a statement given yearly by the UK’s Chancellor of the Exchequer. 📜

The statement outlines the Government’s plans for raising and spending money that year. 

It takes place in the UK’s favourite playground, the House of Commons, where the leader of the opposition has the opportunity to give their two cents too. 💁

What happened in the last Autumn Budget? 

With the 2022 Autumn budget nearly a year ago, let’s recap what Jeremy Hunt had in store for us. 

  • Income Tax and National Insurance thresholds were to remain frozen until 2028
  • The Capital Gains Tax (CGT) allowance was halved from £12,300 to £6,000
  • Dividend allowances were cut from £2,000 to £1,000
  • It was announced that from 2025, electric vehicle users will no longer be exempt from Vehicle Excise Duty 🔌
  • The pension triple-lock would stay in place, meaning the UK Pension wouldn’t lose value or be overtaken by the cost of living
  • The Inheritance Tax threshold will remain frozen until 2028 🏡
  • Corporation tax was to increase from 19% to 25%
  • VAT thresholds were to remain frozen for an additional two years

And all of these changes weren’t exactly cheap. The tax changes were a whopping £55 billion. 💸

Javid’s slow start 

Let’s time-travel back to 2019, when Sajid Javid was appointed Chancellor of the Exchequer as part of Bojo’s new cabinet. 👱

He was supposed to be first Chancellor to reveal an Autumn Budget since one of Britain’s biggest economic decisions of the century; Brexit. 👋

But things didn’t go as planned. The UK’s departure from the EU wasn’t as swift as initially anticipated, so Javid postponed his budget until March 2020. 

Sunak swoops in

In the few months between November 2019 and March 2020, the UK’s Chancellor of the Exchequer was replaced. ✨

And as the saying goes, Out with the old and in with the new. Sorry, Sajid. 🫣

He might be Prime Minister now, but it wasn’t that long ago that Rishi Sunak was responsible for raising revenue. But did he introduce ‘naughty’ or ‘nice’ taxes? 

For many years, women have advocated for an end to the ‘Tampon Tax’, and Sunak announced that the 5% VAT on women’s sanitary products would be scrapped the following January. 

Things didn’t look so good for those affected by the Capital Gains Tax (CGT) reduction. It reduced the Entrepreneurs’ Relief lifetime limit on gains from £10 million to £1 million. 📉

The following Autumn statement was announced amidst the COVID-19 pandemic. Unsurprisingly, it altered the UK’s financial course for the foreseeable future. 😭 

But, after being kept apart via various lockdowns, the Autumn budget revealed a plan to bring us back together. It was announced that from April 2023, flights between airports in England, Scotland, Wales and Northern Ireland would be subject to a new lower rate of Air Passenger Duty. ✈️

Zahawi’s tax evasion “mistake”

After Sunak’s two-year stint as Chancellor of the Exchequer, Nadhim Zahawi took the reins. 

However, history soon repeated itself, as Zahawi’s position as Chancellor came to an abrupt end after a mere two months. 💀

And the shocking (or not so shocking) part? The Chancellor responsible for raising revenue through taxation was sacked due to allegations surrounding his own tax affairs. Tut-tut-tut 😬

Kwarteng’s surprise news

It’s fair to say that Kwasi Kwarteng’s position as Chancellor was short-lived. But, despite not making it to the height of Autumn before his dismissal, Kwarteng tried (emphasis on tried) to have his say. 🍁

In September 2022, Kwarteng delivered ‘The Growth Plan’ a.k.a ‘The Mini Budget’ to the House of Commons. 

Here’s what he announced: 

  • The basic rate of income tax would be brought forward from 20% to 19%
  • The highest rate of income tax, 45%, in England, Wales and Northern Ireland would be abolished 🏗️
  • Plans to increase corporation tax from 19% to 25% from April 2023 were to be reversed
  • The April 2022 increase in National Insurance would be reversed
  • The proposed Health and Social Care Levy would be cancelled ❌

The public deemed Kwarteng’s taxes to be pretty ‘naughty’. Less than a month later, following the mini-budget’s poor reception, plans to abolish the 45% tax rate and increase in corporation tax were reversed by Hunt.

What’s in store for our taxes this year? 

This year’s Autumn Statement will be delivered on Wednesday 22nd November by the UK’s current Chancellor of the Exchequer, Jeremy Hunt. 

And rumours are circulating about what cards Hunt is holding close to his chest. 

So, let’s dig into some of this speculation: 

  • Inheritance Tax cut and abolition – currently the recipients of estates over the tax-free threshold of £325,000 are taxed at a rate of 40%. But, rumour has it that this could be cut or even abolished (eventually). ✂️
  • An increase in the UK’s National Living Wage – at the Conservative Party conference earlier this month, Hunt announced that workers over the age of 23 can expect the minimum wage to increase from £10.42 to £11 an hour.
  • ISA fractional shares to be taxed? Discussions with HMRC have already taken place, but we guess we’ll have to wait and see what Hunt has to say in his Autumn Budget

Of course, there will be a lot more where these rumours came from. But, don’t worry as we’re going to be covering all the changes, tribulations and gossip right here!

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