In the radical package of tax cuts, Chancellor Kwasi Kwarteng brought forward reduction to basic rate of income tax cuts, cuts in national insurance contributions, and the abolition of supplementary rate of income tax.
Mr. Kwarteng announced in his mini budget on Friday that 1pc cut up basic rate of income tax – first announced on former Chancellor Rishi Sunak – to be delivered forward on one year.
This means that from April 2023 basic-rate taxpayers will pay 19% in income tax, down from 20pcs. According to Mr. Kwarteng, it works out as average tax savings of £170 next year for 31 million people.
Additional rate of income tax – 45%. for workers earning £150,000 or more – It has also was abolished. Anyone who earns over £50,271 will pay higher rate of 40pcs after change kicks in in April 2023.