Your reaction to the Chancellor's 'mini-budget': Here's how it will impact Wakefield
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The Government says the new 'Growth Plan' is aiming to tackle energy costs to bring down inflation, to back business and to help households.
The Chancellor revealed his plan to halve rising energy bills and cut tax in order to prevent inflation.
However, the proposals has met mass criticism with many tax-payers claiming it favours the rich and fails to tackle struggles businesses are facing within the current financial economy, following the rising cost of living.
Sarah Padden, owner of Cafe 19 in Wakefield city centre, believes the new budget does not reflect what local businesses actually need.
“The mini budget won’t make enough difference to anyone,” she said.
“The cost of living crisis has made me make a decision to try and keep going or close the doors. My electric more than doubled over night, which makes it so difficult.”
Sarah has had to increase prices within her cafe in order to make up for the impact of the cost of living crisis.
She said: “We can’t keep putting prices up all the time as the customers can’t afford it either.
“We are running on less staff and working longer hours just to survive.”
The plan aims to cut the basic rate of income tax to 19% has been brought forward a year and will now begin from April 2023.
The Chancellor assured that 45% higher rate of income tax will be abolished for taxpayers and that the recent rise in National Insurance will be reversed.
But the cancellation of the higher rate has led to backlash from 1,000s of people as the higher rate applies to those who are earning over £150,000 a year.
This means that a person earning £50,000 would then be paying the same amount of tax as someone earning more than £100,000 more.
In regards to businesses, the proposed corporation tax has been scrapped with the rate remaining at 19%, meaning companies will not pay extra on their trading profits.
Managing director of the Mid Yorkshire Chamber of Commerce, Martin Hathaway, however supported the budget: “We welcome the realistic approach of Mr Kwarteng’s budget and look forward to seeing his three-step energy plan spring into action.
“Coupled with the reversal of next year’s planned corporation tax increase, it is fantastic to see business at the heart of the announcements.”
Within the Growth Plan the Chancellor announced the government’s Energy Bill Relief Scheme.
Their Energy Price Guarantee would aim to save the typical household £1,000 a year on their energy bill with the Scheme halving the cost of energy bills for businesses and other non-domestic users such as charities and public sector organisations.
Commenting on the spending plans, Councillor Denise Jeffery, Leader of Wakefield Council, said: “We will do everything we can to support people in our district with the help/services that we offer.
“In times like this, the national Government relies heavily on local councils like ours to help them deliver support to residents. As well as what we do for our residents on a regular basis.”