Budget 2012 at a glance: George Osborne's key points
INCOME TAX
From April 2013, the 50p top rate of tax will be cut to 45p.
Personal income tax allowance raised to £9,205 from April 2013, making 24 million people £220 a year better off, including higher rate earners.
But 300,000 more people will be drawn into the higher rate - 40% - tax band from 2013/14 as the threshold is reduced from £42,475 to £41,450.
New general anti-tax avoidance rule to be introduced.
Age-related allowances to be removed for new pensioners from April 2013, and replaced with a single personal allowance for all. Allowances for those already of pension age to be frozen.
George Osborne said "no pensioner will lose in cash terms", but HM Revenue and Customs estimates that in 2013-14, 4.41 million people will be worse off in real terms with an average loss of £83. (OP: triple locking pensions will mean pensioners gain £275)
CHILD BENEFIT
Will be phased out when someone in a household has an income of more than £50,000. It will fall by 1% for every £100 earned over £50,000.
Only those earning more than £60,000 will lose the entirety of the benefit.
ECONOMY
Independent Office for Budget Responsibility (OBR) revises up UK growth forecast for 2012 to 0.8% - from 0.7%.
Forecast for 2013 is 2%, for 2014 is 2.7%, and in each of the two years after that 3%.
Eurozone growth forecast for this year revised down from 0.5% to -0.3%.
UK inflation forecast to fall from 2.8% this year to 1.9% next year.
BORROWING
Borrowing this year to be £126bn - £1bn less than forecast in the autumn. Predicted to be £120bn in 2012-13 and £98bn in 2013-14. Forecast to fall to £21bn by 2016-17.
Consultation to be held on offering gilts - government bonds - with maturity terms of more than 50 years.
JOBS AND SKILLS
OBR forecasts unemployment to peak this year at 8.7% before falling each year to 6.3% by 2016-17.
One million more jobs to be created in the economy over five years, OBR says.
HOUSING
From midnight, new stamp duty level of 7% for homes worth more than £2m. Any such homes bought through companies will pay 15%.
Extra funding to help construction firms building new homes.
HELP FOR BUSINESS
Corporation tax cut to 24% from next month. By 2014 it will fall to 22%.
Enhanced capital allowances for businesses setting up in new Scottish enterprise zones in Dundee, Irvine and Nigg. A Welsh enterprise zone to be created in Deeside.
Consultation on simplifying the tax system for small firms with a turnover of up to £77,000.
Government support for £150m of tax increment financing to help councils promote development and an extra £270m for the Growing Places fund.
Tax relief for the video games, animation and high-end television production sectors.
Government considering enterprise loans for young people to start their own business.
Relaxation of Sunday trading laws on eight Sundays during Olympics and Paralympics, starting July 22.
ARMED FORCES
Cost of operations in Afghanistan to be £2.4bn less than expected.
Money saved will provide an extra £100m to improve military accommodation.
Personnel serving overseas will receive 100% relief on an average council tax bill.
Families welfare grant also doubled.
PUBLIC SECTOR
Government evidence to be published on the case for regional public sector pay.
Option for government departments to move to regional pay structures for civil servants when current freeze ends.
ENERGY
"Major package of tax changes" to boost oil and gas extraction in North Sea, along with £3bn new field allowance west of Shetland.
FUEL, CIGARETTE AND ALCOHOL DUTIES
Duty on all tobacco products to rise by 5% above inflation from 18:00 today - the equivalent of 37p on a packet of cigarettes.
No change to existing plans on alcohol duty - meaning the duty will rise 2% above the rate of inflation, putting more than 5p on the price of a pint.
New duty on gaming machines at a standard rate of 20% and a lower rate for low-prize machines of 5% of net takings.
No change to existing plans on fuel duty. Vehicle excise duty to rise by inflation, but frozen for road hauliers.
Existing fair fuel stabiliser means above-inflation rises in fuel duty will return only if price of oil falls below £45 ($70) a barrel.
PENSIONS
Automatic review of state pension age to ensure it keeps pace with increasing lifespans.
New single-tier state pension for future pensioners to be set at about £140 and based on contributions.
TRANSPORT AND INFRASTRUCTURE
Upgrading the Transpennine route between Manchester and Sheffield. Further improvements to the lines between Manchester and Preston, and Manchester and Blackpool.
Report on the future of aviation in south-east England to be published in the summer.
Funding for superfast broadband and wi-fi in the UK's 10 largest cities.
OTHER TAXES AND ALLOWANCES
Bank levy to be increased to 0.105% from January 2013 "to ensure that corporation tax cuts do not benefit the banks". The levy will raise £2.5bn a year.
New cap on tax reliefs set at 25% of total income for anyone claiming more than £50,000 in a year, but no significant change to pensions relief.
VAT loopholes and anomalies to be removed - including removing exemptions for sports nutrition drinks and hot takeaway products in supermarkets.
Existing exemptions will remain for food, children's clothes, books and newspapers.
Personal tax statement to be sent to 20 million taxpayers from 2014.
GREEN MEASURES
Government to seek "major savings" in the administrative cost of the Carbon Reduction Commitment, and bring forward an alternative environment tax this autumn if such savings cannot be found.
Source.
INCOME TAX
From April 2013, the 50p top rate of tax will be cut to 45p.
Personal income tax allowance raised to £9,205 from April 2013, making 24 million people £220 a year better off, including higher rate earners.
But 300,000 more people will be drawn into the higher rate - 40% - tax band from 2013/14 as the threshold is reduced from £42,475 to £41,450.
New general anti-tax avoidance rule to be introduced.
Age-related allowances to be removed for new pensioners from April 2013, and replaced with a single personal allowance for all. Allowances for those already of pension age to be frozen.
George Osborne said "no pensioner will lose in cash terms", but HM Revenue and Customs estimates that in 2013-14, 4.41 million people will be worse off in real terms with an average loss of £83. (OP: triple locking pensions will mean pensioners gain £275)
CHILD BENEFIT
Will be phased out when someone in a household has an income of more than £50,000. It will fall by 1% for every £100 earned over £50,000.
Only those earning more than £60,000 will lose the entirety of the benefit.
ECONOMY
Independent Office for Budget Responsibility (OBR) revises up UK growth forecast for 2012 to 0.8% - from 0.7%.
Forecast for 2013 is 2%, for 2014 is 2.7%, and in each of the two years after that 3%.
Eurozone growth forecast for this year revised down from 0.5% to -0.3%.
UK inflation forecast to fall from 2.8% this year to 1.9% next year.
BORROWING
Borrowing this year to be £126bn - £1bn less than forecast in the autumn. Predicted to be £120bn in 2012-13 and £98bn in 2013-14. Forecast to fall to £21bn by 2016-17.
Consultation to be held on offering gilts - government bonds - with maturity terms of more than 50 years.
JOBS AND SKILLS
OBR forecasts unemployment to peak this year at 8.7% before falling each year to 6.3% by 2016-17.
One million more jobs to be created in the economy over five years, OBR says.
HOUSING
From midnight, new stamp duty level of 7% for homes worth more than £2m. Any such homes bought through companies will pay 15%.
Extra funding to help construction firms building new homes.
HELP FOR BUSINESS
Corporation tax cut to 24% from next month. By 2014 it will fall to 22%.
Enhanced capital allowances for businesses setting up in new Scottish enterprise zones in Dundee, Irvine and Nigg. A Welsh enterprise zone to be created in Deeside.
Consultation on simplifying the tax system for small firms with a turnover of up to £77,000.
Government support for £150m of tax increment financing to help councils promote development and an extra £270m for the Growing Places fund.
Tax relief for the video games, animation and high-end television production sectors.
Government considering enterprise loans for young people to start their own business.
Relaxation of Sunday trading laws on eight Sundays during Olympics and Paralympics, starting July 22.
ARMED FORCES
Cost of operations in Afghanistan to be £2.4bn less than expected.
Money saved will provide an extra £100m to improve military accommodation.
Personnel serving overseas will receive 100% relief on an average council tax bill.
Families welfare grant also doubled.
PUBLIC SECTOR
Government evidence to be published on the case for regional public sector pay.
Option for government departments to move to regional pay structures for civil servants when current freeze ends.
ENERGY
"Major package of tax changes" to boost oil and gas extraction in North Sea, along with £3bn new field allowance west of Shetland.
FUEL, CIGARETTE AND ALCOHOL DUTIES
Duty on all tobacco products to rise by 5% above inflation from 18:00 today - the equivalent of 37p on a packet of cigarettes.
No change to existing plans on alcohol duty - meaning the duty will rise 2% above the rate of inflation, putting more than 5p on the price of a pint.
New duty on gaming machines at a standard rate of 20% and a lower rate for low-prize machines of 5% of net takings.
No change to existing plans on fuel duty. Vehicle excise duty to rise by inflation, but frozen for road hauliers.
Existing fair fuel stabiliser means above-inflation rises in fuel duty will return only if price of oil falls below £45 ($70) a barrel.
PENSIONS
Automatic review of state pension age to ensure it keeps pace with increasing lifespans.
New single-tier state pension for future pensioners to be set at about £140 and based on contributions.
TRANSPORT AND INFRASTRUCTURE
Upgrading the Transpennine route between Manchester and Sheffield. Further improvements to the lines between Manchester and Preston, and Manchester and Blackpool.
Report on the future of aviation in south-east England to be published in the summer.
Funding for superfast broadband and wi-fi in the UK's 10 largest cities.
OTHER TAXES AND ALLOWANCES
Bank levy to be increased to 0.105% from January 2013 "to ensure that corporation tax cuts do not benefit the banks". The levy will raise £2.5bn a year.
New cap on tax reliefs set at 25% of total income for anyone claiming more than £50,000 in a year, but no significant change to pensions relief.
VAT loopholes and anomalies to be removed - including removing exemptions for sports nutrition drinks and hot takeaway products in supermarkets.
Existing exemptions will remain for food, children's clothes, books and newspapers.
Personal tax statement to be sent to 20 million taxpayers from 2014.
GREEN MEASURES
Government to seek "major savings" in the administrative cost of the Carbon Reduction Commitment, and bring forward an alternative environment tax this autumn if such savings cannot be found.
Source.
Can one of our British members provide some perspective on this budget? Good? Bad? Disaster?
From my perspective (obvs other Brits may differ), it's a lot better than I expected. I like the increased stamp duty and increased personal allowance (amount you can earn before paying tax).
Cuts in taxes for the rich (people on £150k+ a year now pay 45% instead of 50%) & businesses, but people who earn just over £41K a year will now have to pay the $0% tax rate. So people who earn over £100k more only have to pay 5% more tax. Ya seems really fair.
And then there's this tweet "Osborne gave me and millions like me a 200 quid tax cut. But he gave 14,000 millionaires a £42k tax cut #inthistogether?" which sums it up imo.
Fuel, yes, that's bad. We're not quite feeling the fuel pinch in the States just yet, but we will. Are the high fuel costs affecting your food costs? (Here in the states a lot of food is shipped over land in trucks, so higher fuel costs = higher food costs, it's one of the hidden results people generally don't know about.)
More fuel duty will push inflation - and it's already really high
How many times has this come up now and then been scrapped? Three? Four times?
Sometimes I really wish Ed showed more backbone but I do love it when he gets to snark. I lol'ed when he asked the cabinet to raise their hands if they benefit from the new tax cuts.
Can they also please stop with this whole regional public sector pay shit.
Ugh, YES. Way to increase the regional divide even more.
Oh my god I fucking hate these guys...
I have a feeling that the next few months could be the making of Ed Miliband. If he keeps the public eye on the cuts, the NHS and the fact that this is a deeply unprogressive government he could get real traction.
This government just keep making me angrier and angrier. Feel incredibly disenfranchised right now.
But hey, the Lib Dems wanted that balanced with a wealth tax! Great so we have... a stamp duty hike? Really? That's it? This is the Lib Dem's wealth tax? If soemone sells their £2,000,000 mansion they're taxed - but if they live in it (and maybe own several more) and coin it in they get a hike.
Do we see any taxes on ridiculous bonuses? Why no, it appears not.
He said in five years' time welfare would make up a third of all public spending, so to keep cutting spending at the current rate either welfare spending needed to fall another £10bn or other departments including education, health, defence and culture would have to cut spending even deeper.
Cuts to welfare spending will always be politically sensitive, but this £10bn would be on top of about £24bn savings already projected from the recent Welfare Reform Act; in total, the government would have to take £34bn out of the pockets of the most vulnerable people in society in that year.
http://www.guardian.co.uk/uk/2012/mar/2
This is what I'm most worried about. Anyone heard any more details about exactly where the benefit cuts are being made?
Edited to finish my comment
Edited at 2012-03-22 12:13 am (UTC)