UK raises taxes on dividends to help plug hole in public finances

British finance minister Jeremy Hunt announced on Thursday that he was cutting the tax-free allowance for dividend income and capital gains to fix a hole in the public finances. "These changes still leave us with more generous allowances overall than countries like Germany, Ireland, France, and Canada," Hunt told parliament as he made a speech on his tax and spending plans.

British finance minister Jeremy Hunt announced on Thursday that he was cutting the tax-free allowance for dividend income and capital gains to fix a hole in the public finances. Hunt said he would cut the amount shareholders can earn in dividends before they begin paying tax from the current level of 2,000 pounds ($2,366) to 1,000 pounds next year and 500 pounds from 2024.

The amount people can claim tax-free for capital gains will fall from 12,300 pounds currently to 6,000 pounds next year and 3,000 in 20204, he said. "These changes still leave us with more generous allowances overall than countries like Germany, Ireland, France, and Canada," Hunt told parliament as he made a speech on his tax and spending plans. ($1 = 0.8452 pounds)

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