Update on UK tax policy announcements and Autumn Statement

An update on all the latest UK tax policy announcements, including plans for an Autumn Statement on 17 November 2022.

An update on all the latest UK tax policy announcements.

Events since our last edition of Tax Matters Digest on 17 October 2022 have continued to move at pace. Rishi Sunak has succeeded Liz Truss as Prime Minister and Jeremy Hunt has retained his recent appointment as Chancellor, after reversing much of what was announced in the Fiscal Event on 23 September 2022. We will have to wait a few more weeks to hear details of the new administration’s tax policies: the previously announced ‘Medium-Term Fiscal Plan’ set for 31 October 2022 has now been upgraded to a full Autumn Statement that will take place on 17 November 2022. In the meantime, with so many developments in a short space of time, this article summarises the position of recent tax announcements as at the time of writing.

What has happened so far?

The table below sets out which of the tax announcements made in the 23 September 2022 ‘Growth Plan’ (see the 3 October 2022 edition of Tax Matters Digest for details) have survived, and which have been reversed.

23 September 2022 announcement


Corporation tax rate to remain at 19 percent instead of increasing to 25 percent


Diverted Profits Tax rate to remain at 25 percent instead of increasing to 31 percent


Cancellation of planned compensating decrease in bank surcharge


Annual investment allowance to remain at £1 million permanently

Additional rate of income tax (45 percent rate) to be scrapped from April 2023


Basic rate of income tax to be cut to 19 percent from April 2023


Health and Social Care Levy (and earlier NIC rise) to be scrapped

Reversal from April 2023 of April 2022 increase of 1.25 percent to dividend tax rates


Reforms to the off-payroll working rules to be repealed


Company Share Option Plan changes

Seed Enterprise Investment Scheme changes

Stamp Duty Land Tax threshold increases

New ‘Investment Zones’ announced


VAT-free digital shopping scheme for non-UK visitors


Alcohol duty rates frozen for a year


Of the five surviving announcements one has already been enacted into law: The Health and Social Care Levy (Repeal) Bill received Royal Assent on 25 October 2022. A second, The Stamp Duty Land Tax (Reduction) Bill, is progressing through the legislative process. It received its second reading in the House of Commons on 24 October 2022. A date for the Bill to go through Committee stage is yet to be fixed.

Uncertainty remains regarding the status of the cut in the banking surcharge from 8 to 3 percent from April 2023. This cut (which has already been legislated for) was broadly intended to offset the increase in the corporation tax rate from the same date, reflecting the stated view of the then Chancellor (Rishi Sunak) that without an adjustment “the implied overall tax rate for banks would be too high”. When the September ‘Growth Plan’ instead proposed freezing the corporation tax rate at 19 percent, however, the Chancellor at that stage (Kwasi Kwarteng) announced that the cut in the surcharge would similarly be scrapped as no longer needed.

Although the new Chancellor (Jeremy Hunt) has confirmed that the corporation tax rate will now increase next year, he has so far been silent on whether that means that the offsetting cut in the surcharge rate will similarly be allowed to go ahead – with the Government instead simply saying that the “Chancellor will confirm the position on the Bank Surcharge in the Medium-Term Fiscal Plan”. This deliberate silence has provoked widespread speculation that economic pressures coupled with suggestions that some in the banking sector have received a ‘windfall’ benefit from rising interest rates have prompted the Government to reconsider the extent of any surcharge reduction. The probable outcome of any reconsideration and how this will be impacted by the fact that Rishi Sunak is now Prime Minister remains far from clear, with any decision unlikely now to be formally announced before the Autumn Statement on 17 November 2022.

Another area that is currently uncertain is whether the Government will proceed with the introduction of Investment Zones and, if so, in what form. During the parliamentary debate following the reversal of many of the 23 September 2022 announcements, the Chancellor implied Investment Zones would be taken forward but there has been no official confirmation and it is hoped the Autumn Statement will provide some clarity.

On 17 October 2022, the Chancellor (Jeremy Hunt) also announced the establishment of a new Economic Advisory Council. The announcement stated that the Council will “act as a consultative forum for the Government to be advised on UK and international economies and financial markets” and will “consist of leading and respected economists”.

What’s next?

On 26 October 2022, the Chancellor announced that the Medium-Term Fiscal Plan would not go ahead on 31 October 2022. Instead, it will be upgraded to a full Autumn Statement accompanied by OBR forecasts on 17 November 2022. According to HM Treasury this announcement “will contain the UK’s medium term fiscal plan to put public spending on a sustainable footing, get debt falling and restore stability”.