It is Budget Day ansd so far there has been help for heroes, cash for the NHS, the end of subsidies for those social housing if they earn over £30,000, a cut in the benefit cap and changes to the non dom rules.
First up... the state of the economy.
The chancellor says that the economy grew by 3% in 2014, with a 2.4% growth forecast in 2015, followed by 2.3% and 2.4% in the two following years. There are set to be 1 million extra jobs created by 2020, however whatb the quiality of these jobs will be is not clear.
The deficit to be cut at same pace as during last Parliament - securing a budget surplus a year later than planned in 2019-20
Borrowing is set to fall from £69.5bn this year to £43.1bn, £24.3bn and £6bn before hitting a £10bn surplus in 2019-20
Debt as a share of GDP to fall from 80.3% this year to 79.1%, 77.2%, 74.7%, 71.5% and 68.5% in successive years.
- A crack-down on tax avoidance is alos on the cards with permanent non-dom status to be abolished from April 2017.
- 18-21-year-olds will not be entitled to claim housing benefit automatically, with a new "earn to learn" obligation
- Employment and Support Allowance payments for new claimants who are deemed able to prepare for work to be "aligned" with Jobseeker's Allowance
- Green Paper published on proposals for "a radical change" to pension saving system
- The amount people can contribute to their pension tax-free to be reduced for individuals with incomes over £150,000
- No rise in fuel duty this year with rates continuing to be frozen
- Major reform to vehicle excise duties to pay for a new road-building and maintenance fund in England
- New VED bands for brand new cars to be introduced from 2017, pegged to emissions for the first year. Subsequently, 95% of car owners will pay a flat fee of £140 a year
- Alcohol and tobacco duties not mentioned in statement
- Income threshold for tax credits to be reduced from £6,420 to £3,850
- Working-age benefits to be frozen for four years - including tax credits and local housing allowance, but maternity pay and disability benefits exempted
- Rents in social housing sector will be reduced by 1% a year for the next four years.
- Subsidies for social housing will be phased out with local authority and housing association tenants in England who earn more than £30,000 - or £40,000 in London - having to pay up to the market rent
- Disability benefits will not be taxed or means-tested while state pension triple lock to be protected
- Tax credits and Universal Credit to be restricted to two children, affecting those born after April 2017
- Student maintenance grants to be replaced with loans from 2016-17, to be paid back once people earn more than £21,000 a year
- The maintenance loan will increase to £8,200
- New university professorships to be created to mark the Queen's 90th birthday
- £50 million to expand the number of cadet units in state schools
- New apprenticeship levy for large employers
- Climate Change Levy exemption for renewable electricity to be removed
- National Insurance employment allowance for small firms to be increased by 50% to £3,000 from 2016
- Dividend tax credit to be replaced with a new tax-free allowance of £5,000 on dividend income. Rates of dividend tax to be set at 7.5%, 32.5% and 38.1%.
- Annual investment allowance will be fixed permanently at £200,000 from January 2016
Also...
- Non-doms who have lived in the UK for 15 of the past 20 years will pay same level of tax as other UK citizens
- UK-born citizens will be barred from becoming non-doms and will be required to pay same level of inheritance tax
- £7.2bn to be raised from clampdown on tax avoidance and tax evasion with HMRC budget increased by £750m
Other key points include
- NHS will receive a further £8bn by 2020
- The cost of funding free TV licences for the over-75s will be transferred from the government to the BBC between 2018 and 2021
- The annual household benefit cap will be reduced to £23,000 in London and to a lower level in the rest of Britain.
- Subsidies for social housing will be phased out with local authority and housing association tenants in England who earn more than £30,000 - or £40,000 in London - having to pay up to the market rent
- A consultation will take place on changing Sunday trading laws
- Recipients of the Victoria Cross and George Cross will see annual pension annuities rise from £2,129 to £10,000, paid for by bank fines.
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