BRITS are set to cash in next week when the Chancellor unveils his emergency mini-Budget to cushion the cost of living onslaught.
Kwasi Kwarteng is preparing to slash taxes for ordinary workers struggling to make ends meet.
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In her Tory leadership campaign Liz Truss pledged to ease the burden on taxpayers being squeezed more than at any other point in peacetime.
Next Friday she is expected to make good on her promises and spell out the tax-slashing bonanza – with National Insurance and Corporation Tax in line for the chop.
It comes on top of a mammoth package to help families pay their energy bills by protecting them from crippling gas and electricity costs.
And Mr Kwarteng is also eyeing a mass cull of red tape to fire up the economy that could be used to pay for the creaking social care system.
Here are the precise savings YOU could benefit from after next week.
NATIONAL INSURANCE
The centrepiece of next week’s “fiscal event” is likely to be Liz Truss’ flagship campaign promise to reverse the 1.25 percentage point rise in National Insurance.
Rishi Sunak hiked the levy last April to pay for the NHS and social care in a deeply controversial move.
He then eased the strain slightly by lifting the threshold point where people start paying the tax to £12,570.
But Brits are now in line for a further saving as Ms Truss will scrap the rise completely and wind it back to pre-April levels.
Critics say it will disproportionately benefit richer workers because they earn more and so will save more.
Here is a breakdown of how much you will save from the reversal:
– A worker on £25,000 will save £155 a year
– A worker on £40,000 will save £343 a year
– A worker on £100,000 will save £1,093 a year
Anyone who earns less than £12,570 a year will continue not to pay any National Insurance at all.
ENERGY BILLS
The tax cuts will come on top of the energy package announced last week moments before the Queen’s death.
The new PM has announced a multi-billion package to save typical Brits £1,000 by protecting them from crippling global gas costs.
Bills were set to rise to £3,500 in October and more than £6,000 next April in a terrifying prospect for most households.
However in a mammoth intervention – which could cost more than furlough – Ms Truss is now going to cap costs from October 1, with the typical family paying no more than £2,500.
She has capped unit prices – meaning you will still pay more for using more – but officials have calculated estimates for how much the plan will save you:
Detached house:
Under October price cap: £4,700
Under new cap: £3,300
Savings: £1,400
Semi detached
Under October price cap: £3,800
Under new cap: £2,650
Savings: £1,150
Mid terraced
Under October price cap: £3,300
Under new cap: £2,350
Savings: £950
Bungalow
Under October price cap: £3,500
Under new cap: £2,450
Savings: £1,050
Flat
Under October price cap: £2,450
Under new cap: £1,750
CORPORATION TAX
Ms Truss has also vowed to scrap the planned increase in Corporation Tax.
The levy on business’ profits was due to rise from 19 per cent to 25 per cent – meaning firms can keep more of their cash.
The PM insists this will help spur economic growth by incentivising firms to do business in London.
Reducing costs on businesses should mean shoppers pay less for products – in a win for consumers.
But the overall benefit will be impossible to calculate for now.
RED TAPE BONFIRE
The new Chancellor is preparing to shred masses of EU red tape strangling City firms – but could ask them to invest in social care in return.
He is set to unveil his “Big Bang 2.0” deregulation blitz at next Friday’s mini-Budget and in a speech to bosses.
As part of the red tape bonfire he is expected to allow fat cats to trouser millions by scrapping the cap on bonuses they can receive on top of their salaries.
He is also set to ditch Brussels’ Solvency II rules that limit insurance firms’ investments in exchange for them pouring money into the cash-starved social care system.
Mr Kwarteng is eyeing a trade-off whereby companies plug the £13billion black hole in the creaking care budget after Ms Truss reverses the National Insurance rise.
It would mean Brits don’t lose out on the government’s social care cap even after the National Insurance rise is reversed.
COST OF LIVING HANDOUTS
Brits will also still continue to receive the cost of living payments announced last spring.
The spring package included a one-off £650 cash handout to benefits claimants, a £300 lump sum to the poorest pensioners and a £150 bung for the disabled.
And an energy bills rebate for all households was also doubled to £40
It came on top of a £150 council tax rebate for homes in bands A to D announced earlier in the year.
