UK: Target is 2.5% medium-term growth – Kwasi Kwarteng

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During a tax declaration before Parliament, the British Chancellor of the Exchequer, Kwasi Kwarteng, has stated that “we need a new approach for a new era, focused on growth. Our medium-term objective is to reach a trend growth rate of 2.5%“.

Additional comments

Limiting bonuses pushed up bankers’ base pay and pushed activity out of Europe.

We will limit bankers’ premiums.

We will establish a ambitious financial services reform later this year.

We will liberalize the planning rules for the new “investment zones”.

Acceleration of tax relief for investment in construction, installations and machinery.

New hires in investment zones will not pay national insurance for the first £50,000 of earnings.

National insurance exemption refers to employer contributions to national insurance.

We will reduce taxes for businesses in designated tax locations for 10 years.

We will review the tax system to make it simpler and more dynamic.

Corporate tax will remain at 19%.

The UK will have the lowest corporate tax rate in the G20.

We will expand the business investment plan. Venture capital trusts beyond 2025.

We will increase the limits on company stock option plans to make them more generous.

We have decided to introduce the VAT-exempt purchases for foreign visitors.

We will abolish the additional income tax rate.

Source: Fx Street

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