Following last week's controversial mini budget and subsequent rapid decline of the value of the pound in the currency market, the most criticised policy has now been reversed.
Many political commentators are blaming the policies introduced by the new premiership of Liz Truss and her Chancellor, Kwasi Kwarteng as the reason for the sharp falls in the pound after the mini budget. The unfunded scrapping of the 45 pence top tax band was particurly set upon due to the immediate market devaluation of the pound, requiring a £65 billion intervention by the Bank of England.
It was a small, circa £2 billion, part of the overall spending pie from Liz Truss' government but received the most focus due to the nature of the overall over £100 billion spending package that was to be funded by borrowing and spending cuts - cuts that would like hit lower earners and benefit claimants, whilst the 45 pence tax band removal itself gave large tax cuts to around 600,000 taxpayers.
This morning the Chancellor reversed the decision, which was due to be in force from April 2023. This means the top rate of tax is back - also affecting dividends.
All our calculators will be updated for the reversal of the decision by the end of today. In the meantime, below is an updated calculator for Liz Truss' first budget.