Finance (No. 2) Bill — Second Reading — 13 Apr 2021 at 20:17

The majority of MPs voted for a range of tax and pensions provisions including keeping key income tax rates and thresholds unchanged and to increase the main rate of Corporation Tax from 19 to 25% from 2023.

MPs were considering the Finance (No. 2) Bill.^[1][2][3]

The motion supported by a majority of MPs in this vote was:

• That the Bill be now read a Second time.

The passing of this motion enabled the Bill to continue on its path to becoming law.

The Bill included provisions:

• to impose income tax during the tax year 2021-22.
• to set the 2021-22 rates for income tax at: Basic rate - 20%; Higher rate - 40%; Additional rate - 45%. (No change on the previous year).
• to increase the tax rates on taxed dividend income.
• to retain the threshold for starting to tax interest on savings at £5,000.
• to set the thresholds for starting to pay income tax, and for starting to pay income tax at the higher rate at £12,570 and £37,700 respectively for 2022-2026.
• to set the main rate of Corporation Tax for the financial year 2022 at 19% and the main rate of corporation tax for the financial year 2023 at 25%

The rates for starting to pay income tax, and for starting to pay income tax at the higher rate, for 2021-22 were £12,570 and £37,700 respectively, so were unchanged.^[4]

The main rate of Corporation Tax had been 19% since 2017.^[5]

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• [1] Parliament's webpage on the Finance (No. 2) Bill, Parliament.uk
• [2] The Finance (No. 2) Bill (as introduced 11 March 2021), Parliament.uk
• [3] Explanatory notes to the Finance (No. 2) Bill, Parliament.uk
• [4] Income Tax rates and allowances for current and past years, Gov.uk
• [5] Rates and allowances for Corporation Tax, HMRC, Gov.uk

Debate in Parliament |