The dramatic U turn on taxes this week will hopefully restore some confidence and market stability to the already fragile housing market.

The planned corporation tax will now go ahead as originally planned in April 2023, increasing from 19% to 25%; Income tax will remain at 20%; and the 45% tax on earnings over £150,000 will remain. Alcohol duty rates will not be frozen from February next year, causing the UK wine and spirit industries more disruption. The rise in National Insurance contributions which rose in April this year, will be reversed next month.

In housing, the cut to the stamp duty threshold, which came in on 23rd September this year, will remain. Meaning that the price of a property before stamp duty is paid is £250,000, which is double the amount of its previous level of £125,000. First time buyers benefit, as they will only start to pay stamp duty after £425,000. The rates of stamp duty now stand at:

Up to £250,000 Zero
The next £675,000 (the portion from £250,001 to £925,000) 5%
The next £575,000 (the portion from £925,001 to £1.5 million) 10%
The remaining amount (the portion above £1.5 million) 12%
An example of this is spending £625,000 on a home will cost around £19,000 or at £1m the stamp duty will be £41,000

Abolishing section 21 evictions – the so called no fault possessions, is still being brought forward, but details relating to the changes of section 8 definitions, that have been promised for years, have not materialised.

In energy price management, the new Chancellor – Jeremy Hunt said on Monday this week that the EPG (energy price guarantee), which limits the unit price of energy, and was intended to last for two years from this month, will now only be relevant until April 2023. This has led some forecasters to suggest that an average household’s dual fuel tariff will rise to £4,300 in six months’ time.

Inflation was standing at 9.9% in August, and the latest figures show a rise to 10.1% for September as the cost of food and energy prices continue to surge.  The Bank of England says it expects inflation to “peak at 11% and then remain above 10% for a few months before starting to come down”

On 31st October the new chancellor will issue another fiscal statement.