The news just in is a Government U turn on abolishing the 45% Income Tax Rate.
Its abolition was announced from April 2023 in last months Mini Budget ( aka Growth Plan) but the PM and Chancellor have had a torrid time since, with adverse market and political reaction, so it looks like it’s staying.
I’d have to look up when 45% Income Tax came in, I think it was a good few years ago as a reduction from the then top rate of 50%. But it’s been settled at a threshold of £150k income for some time, which means comparatively few people pay it, especially if well advised. My sense is that politically it is somewhat totemic, and probably the market view won’t change – it’s not as if this panicked announcement inspires confidence in Government when all is said and done?
We’ve six months until the start of the 2023/24 tax year, and at this stage it’s hard to be sure what else may change. Fortunately tax policy is probably low down the risks facing business at present – economy, energy, demand, supply chains, are probably all more sensitive.
Jessica