Budget: At a glance
Budget: At a glance
Chancellor George Osborne made public sector cuts and freezes but seemed to largely support business in a budget he said was “tough but also fair” and “pays for that past and plans for the future.”
Key announcements include:
Economy
+ On track to ensure debt falls as a percentage of GDP by 2014/15 – a year earlier than planned.
+ Growth of 1.2% in 2010 rising to 2.7% in 2014/15.
+ Inflation targets remain at 2%.
+ 77% of cuts to come from spending reductions, 23% from tax increases.
+ Public sector borrowing to fall from £149bn in 2010 to £20bn by 2015/16.
Business
+ VAT to increase to 20% from 17.5% from January 4, 2011.
+ Corporation tax to be cut by 1% a year for the next four years from next year, bringing it down from 28% to 24%.
+ Small company corporation tax to be cut to 20% next year.
+Employers National Insurance threshold to rise.
+ New businesses not in the south will be exempt from £5,000 National Insurance contributions for their first 10 staff.
+10% Capital gains tax for entrepreneurs to be extended to first £5m, from £2m.
+ Two year pay freeze for public sector worker. Those earning under £21,000 to get a flat increase of £250 each of those years.
+ Extend the Enterprise Finance Guarantee Scheme, a move to benefit at least 200,000 businesses.
+Banking levy to be introduced from 2011, generating more than £2bn in annual revenues.
+ Creation of a green investment bank to encourage private investment in green technologies.
Personal
+ Capital Gains Tax to increase to 28% from 18% for the highest rate payers, from midnight tonight.
+ Income tax personal allowance to increase £1,000 to £7,425 from April 2011.
+ An acceleration in the increase in state pension age to 66.
+ Triple lock for pensions, guaranteeing a rise in line with earnings, prices or 2.5%, whichever is greater.
+ Tax credits to be reduced for families earning more than £40,000, from next year.
+Increase child element of child tax credit by £150 above inflation next year.
+ Benefits, except for the state pension and pension credit, to be increased inline with consumer prices not the retail price index, a measure that will save £6bn.
+ Back dating for benefits will be reduced to one month, from three months.
+ Child benefit to be frozen for the next three years.
+Health in pregnancy grant abolished.
+ Medical assessment to be applied to new disabilities living allowance claimed from 2013.
+Maximum limit of £400 a week on housing benefit introduced, to save £1.8bn a year.
+ Help for local authorities to freeze Council Tax.
Duty
+ No new increases on alcohol, tobacco or fuel.
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- Budget: Sigh of relief at caution on CGT
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- Budget: Why George survived the tightrope walk – for now
