Who Wins Most From Kwarteng’s Tax Bonanza?
Wealthy men living in London and the south of England stand to gain most from the sweeping tax cuts unveiled by Chancellor of the Exchequer Kwasi Kwarteng. These three charts show how.
(Bloomberg) --
Wealthy men living in London and the south of England stand to gain most from the sweeping tax cuts unveiled by Chancellor of the Exchequer Kwasi Kwarteng. These three charts show how.
Kwarteng said a cut in the basic rate of income tax will now take effect in April -- a year earlier than planned. Three quarters of those who don’t earn enough to pay income tax are women, according to the Women’s Budget Group.
It’s a similar story when it comes to abolishing the top 45% tax rate, charged on incomes above £150,000 ($164,000). Around 80% of those affected are men. The decision is projected to cost the exchequer around £2 billion.
Londoners are the big beneficiaries from the decision to double the threshold for paying stamp duty, a tax on homebuying. That’s because house prices in the capital are twice as high as the national average at more than £540,000, according to Land Registry data. Almost half that amount is now tax free, with the relief for first-time buyers even more generous.
All told, the tax giveaways announced Friday are costing the exchequer around £40 billion a year. Almost half will go to the richest 5% of the population, according to the Resolution Foundation.
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