Sigh of relief for UK tech founders as Labour hikes capital gains tax by less than feared

Published On Oct 30, 2024, 11:20 AM

The UK Labour government has raised the capital gains tax (CGT) rates in its budget announcement, but the increases are less severe than feared, providing some relief to tech entrepreneurs. The lower CGT rate is now 18% (up from 10%), and the higher rate is 24% (up from 20%), which is expected to generate £2.5 billion. The government has kept the business asset disposal relief limit at £1 million, easing previous concerns. However, businesses will also see an increase in National Insurance contributions. Overall, while there are tax increases, they are more moderate than anticipated, which may help retain tech talent in the UK.