Government U-turn on Corporation Tax cut – what you need to know

Notwithstanding any further announcements from Downing Street over the coming weekend, prime minister, Liz Truss, has this afternoon announced the reversal of a key policy to freeze Corporation Tax.

During a short press briefing, the PM reversed the government’s plans to freeze Corporation Tax at 19%, meaning the party’s plan to increase Corporation Tax to 25% from April 2023 will now go ahead.

Reacting to significant pressure from the Markets, the PM explained how the reversal would raise £18bn a year for the UK economy, but maintained that she is still committed to “wanting” to deliver “a low tax, high wage, high growth economy”.

For now, we don’t foresee any further Budget U-turns, but with a new chancellor appointed – Jeremy Hunt – and the Fiscal Plan expected to be brought forward to October 31st (Halloween), who knows if there are any more spooky surprises lined up this autumn.

We will bring you more information as soon as this is available. If you have any queries, contact your local Champion office.