Budget Update!
March 23, 2011 in Budget News, Finance, UK
This afternoon I delivered my second Budget. I wanted to write to you immediately to explain our plans and set out some of the key measures.
Last year’s Emergency Budget was about rescuing the nation’s finances and paying for Labour’s mistakes. Today’s Budget sticks to the plan, and focuses on reforming the economy to ensure jobs and growth for the future. I am also doing what I can help to families with the cost of living – including an immediate cut to fuel duty.
I know times aren’t easy for families at the moment, so this Budget announced help, including:
• An immediate cut in fuel duty by 1 pence per litre and a delay of April’s inflation rise in duty to next January. This means fuel duty is 6 pence lower than it would be under Labour. We are paying for this by putting up taxes on the oil companies while the oil price is high to create a Fair Fuel Stabiliser.
• An increase in the personal allowance from £6,500 to £8,100 over the next two years. This will mean £326 extra for working people and it will lift over a million low paid people out of tax altogether.
• £250 million to help 10,000 first time buyers get on the housing ladder.
• A freeze in Air Passenger Duty this year.
• Money for councils so virtually every council in England will freeze council tax next month.
• A new scheme to allow Gift Aid to be claimed on the contents of charities’ collecting tins and street buckets, and support for largest donations with radical reforms to Inheritance Tax – if you leave 10 per cent or more of your estate to charity, then the Government will take 10 per cent off your inheritance tax bill.
As well as helping in the short term we need to reform our economy to create growth and jobs in the future. The hard truth is that Britain has lost ground in the world economy.
Under Labour manufacturing halved, and growth depended on unsustainable public spending, debt and financial services. We need a new model of growth based on investment, manufacturing and exports – a Britain that makes things again. This Budget started that process, with measures that include:
• An additional 1p cut in corporation tax. In April this year corporation tax will fall from 28% to 26%. It will continue to fall by 1% in each of the following three years reaching 23%. Britain will be competitive again.
• Doubling Entrepreneurs Relief to £10m and sweeping changes to the generosity, simplicity and reach of the Enterprise Investment Scheme, with an increase in the income tax relief available from 20% to 30%.
• An extension of the small business rate relief holiday for another year.
• An additional £100m for new science facilities and more generous tax credits for small business research and development.
• 21 new Enterprise Zones with business rate cuts and new broadband to promote growth across the country.
• A review of the revenue raised by the temporary 50p rate of income tax.
• 50,000 additional apprenticeships and 100,000 work placements for young people.
• £3bn for a Green Investment Bank, which will generate an additional £15 billion in private sector investment in green projects and low carbon energy.
The Confederation of British Industry has already endorsed our approach saying: “This Budget will help businesses grow and create jobs.”
So this is our plan – reforming the economy to create jobs and supporting families. This Budget will put fuel back in the tank of Britain’s economy.
George Osborne
Chancellor of the Exchequer
In response to suggestions that the UK is already in a recession, Business Link has issued its top ten steps to help local businesses prepare to survive the economic slowdown.
ABOUT BUSINESS LINK