<p style=”” class=”text-align-justify”>In total, the measures <a href=”https://www.forexlive.com/news/uk-finance-minister-says-will-scrap-planned-increase-on-corporation-tax-20220923/” target=”_blank”>announced</a> will amount to £27 billion of tax cuts through the next fiscal year before rising to roughly £45 billion by 2026-27. That’s a huge reach as those tax cuts are the biggest since 1972.</p><p style=”” class=”text-align-justify”>The budget also massively benefits the UK’s wealthiest as the planned increase for corporation tax has been scrapped and bankers’ bonuses will not be capped. Throw in the fact that those earning millions will also pay the same income tax rate as those on £50k earning, it’s a massive break from tradition for the Tories.</p><p style=”” class=”text-align-justify”>There’s also that 1% tax cut for the lower-to-middle class too but then again saving 1% on £30k earning is not really the same as compared to saving 5% on £150k and above now, is it? But if anything else, it highlights what the government is really focusing on here and that is to really bolster growth conditions – regardless of the cost (which in this case is £161 billion over 5 years).</p><p>UK bond yields are seeing a massive jump, with 2-year gilt yields up over 30 bps to 3.86% – its biggest daily jump since November 2009:</p><p style=”” class=”text-align-justify”>I think this meme captures very well the sentiment UK financial circles at the moment:</p>
This article was written by Justin Low at forexlive.com.