George Osborne announced sweeping changes to stamp duty and confirmed plans to extend business rate relief in an Autumn Statement described as “solving problems” by campaigners.

In a detailed 50-minute speech – no doubt with an eye on the upcoming general election – the Chancellor outlined several new measures including doubling Small Business Rate Relief for another year.

He also increased tax credits for research and development firms and pledged to impose a 25% tax on profits made in the UK by multinational corporations.

The rabbit out of the hat was a an overhaul of stamp duty, which comes into effect at midnight tonight.

This will be cut altogether on homes worth up to £125,000, rising to 2% on property valued up to £250,000, then 5% up to £925,000, 10% up to £1.5m and 12% over £1.5m.

Nick Gabay, partner at Tunbridge Wells-based law firm Thomson Snell & Passmore, said: “The biggest surprise of the Autumn Statement was delivered as the Chancellor’s grand finale – a radical reform of the stamp duty regime, effective immediately.

“The introduction of marginal rates of stamp duty will hopefully make it easier for first-time buyers to get on the property ladder.

“The heavier tax burden falling on more expensive properties will also provide a politically plausible alternative to the mansion tax championed by the other parties.”

Kent Invicta Chamber of Commerce chief executive Jo James said: “The Chancellor has used the last Autumn Statement before the election to demonstrate that he is listening to and supporting British businesses across the entire country.

“By focusing on key business priorities, such as Britain’s broken business rates system and the difficulty of accessing finance for growth, the Chancellor has demonstrated that he is committed to solving problems that hinder the growth aspirations of many firms.

“Businesses will be pleased that the Chancellor has committed the government to a fundamental review of business rates.

“This iniquitous tax is sapping good companies’ strength year after year, long before they make a single penny in profits.”

Rural businesses also backed the Chancellor’s changes on business rates but expressed disappointment that tax cuts did not go further.

“Businesses will be pleased that the Chancellor has committed the government to a fundamental review of business rates..." - Kent Invicta Chamber's Jo James

CLA director South East Robin Edwards said: “Businesses across the rural economy are suffering from business rates that increase year after year.

“We will engage with this important review and make the case for reducing the burden of tax to promote investment and growth across our rural communities.

“We are disappointed the Chancellor has once again failed to remove the tax on empty properties.

"This is essential for owners to afford the investments needed to bring these properties back into use.”

The Autumn Statement also announced that air passenger duty will be abolished for under 12s from May next year, extending to under 16s the year after.

Folkestone-based Saga Travel’s Louis Myers said: “Scrapping air passenger duty for children under 12 will be of great benefit to families – both parents and grandparents, many of whom pay for family holidays – we know that a quarter of grandparents take their grandchildren on holiday and 42% of over 50s take their children away.

“Also, with the Scottish Parliament potentially being given powers to vary APD there could be a boost for Scottish airports and tourism.

“In the future the Chancellor should consider reducing or abolishing the tax for all travellers.”