Chancellor’s Growth Plan revealed – top line announcements

The Chancellor Kwasi Kwarteng MP has unveiled the new Growth Plan, with a view to tackling energy costs bringing down inflation, and “backing business and helping households”.

Key headlines are:

• Corporation tax rise cancelled, keeping it at 19% as government sets sights on 2.5% trend rate of growth.
• Basic rate of income tax cut to 19% in April 2023 – one year earlier than planned – with 31 million people getting on average £170 more per year.
• Stamp Duty cuts to help people on all levels of the property market and lift 200,000 homebuyers every year out of paying the tax altogether.

Key points in the Plan – which can be viewed in full here – relating to transport and infrastructure

Investment Zones – The government will work with the devolved administrations and local partners to introduce Investment Zones across the UK. Investment Zones aim to drive growth and unlock housing. Areas with Investment Zones will benefit from tax incentives, planning liberalisation, and wider support for the local economy

VAT free shopping – The government will introduce a modern, digital, VAT-free shopping scheme, with the aim of providing a boost to the high street and creating jobs in the retail and tourism sectors.

Minimum Service Levels – The government will introduce legislation that will ensure Minimum Service Levels can be put in place for transport services, limiting the impact that industrial action can have on the public’s ability to make the journeys that are essential for day-to-day life.

Industrial Disputes – The government is taking action to make it easier to settle industrial disputes by ensuring meaningful employer pay offers are put to employees.

Planning reform to accelerate infrastructure delivery – read more here.

Streamlining Local Growth Funds – The government has invested in local growth through a wide range of competitions and grants, but recognises that the sheer number of different funds has become onerous for some councils to navigate and deliver. Over the next two years, the government will streamline these, reducing inefficiency and bureaucracy, and giving local government the flexibility it needs to deliver for local economies

The Government has also published a list of infrastructure projects which will be accelerated as fast as possible, aiming to get the vast majority starting construction by the end of 2023. It can be read from page 35 on, and includes roads, rail, decarbonisation, and local transport.

The Government has also published a list areas interested in investment zones, which can be found on page 33.