Budget 2010 – Highlights
Chancellor of the Exchequer Alistair Darling is delivering what looks like to be his last ever Budget Report to the House of Commons at 12.30pm today.
This is a ‘live’ blog and will be updated during the Budget speech and later in the day, once we have completed our analysis of the various documents.
If you have any questions about the impact of the Budget on your personal financial planning, including your retirement planning and investments, please post them below and we will do our best to answer them.
Informed Choice Chartered Financial Planner Martin Bamford is part of an expert panel for the Guardian from midday on Thursday at http://www.guardian.co.uk/money/blog.
Here are some of the highlights:
-Budget to secure recovery, tackle borrowing, invest in economic future. Borrowing is lower than forecast last year.
-£2.5bn one-off growth package for small businesses, paid for from existing spending and banker bonus tax.
-Darling will sell shares in Northern Rock, RBS and Lloyds in a way to maximise value to the taxpayer, recovering all of investment.
-Banker bonus tax has raised £2bn so far, more than twice as much as forecast. Darling supports an international bank levy.
-Providing mandatory access to basic bank accounts.
-Reducing minimum number of hours for eligibility for Working Tax Credits for people over 60.
-Considering scrapping default retirement age or increasing it.
-Unemployment guarantee offering work or training extended for young people until March 2012.
-Support for mortgage interest scheme – support will continue to be paid for another six months.
-First time buyers – doubling stamp duty threshold to £250,000 for first time buyers from midnight tonight. Nine in ten first time buyers will not pay any stamp duty. Increase in stamp duty to 5% for property over £1 million to fund this giveaway.
-Individual Savings Accounts (ISAs) – annual limit rises to £10,200 from 2010/11 with up to half in cash. Will rise in line with inflation each year after that.
-Economic growth revised downwards for 2011, for 3-3.5% in line with Bank of England forecasts. Forecasts for following years remains unchanged.
-Inflation target remains unchanged at 2% and interest rates expected to remain low, stable.
-Borrowing forecast this year £11bn lower than previously anticipated at £167bn for 2009/10
-Duty on beer, wines and spirits will increase as planned from midnight on Sunday. Duty on Cider will be increased by 10% above inflation. Changes will be made to definition of specific strong ciders from December.
-Tobacco duty will rise by 1% above inflation from today.
-Freezing inheritance tax threshold for a further four years.
-New credit adjudication service for SMEs if they think they have been unfairly denied loans.
-Uk Finance for Growth – new investment body to oversee £4bn range of finance support for businesses.
-Time to pay scheme for businesses to spread payment of tax they owe, scheme extended for the whole of the next parliament.
-Business rates – cut for one year from October for small businesses, 345,000 will pay no business rates at all.
-Annual investment allowance for small businesses doubled to £100,000.
-Doubling entrepreneurs relief for capital gains tax to first £2m of gains which will be taxed at 10% not 18%.
-Not increasing the main rate of capital gains tax.
-£100m to pay for local road repairs (potholes!) and £280m to pay for improvement to motorway network.
-Confirms 50p monthly landline duty to fund Digital Britain initiatives.
-£2bn for new green investment bank.
-Setting up a £35m University Enterprise Capital fund.
-Tax avoidance measures to bring in additional £500m each year. Includes tax information exchange agreements with tax havens, including Dominica, Grenada and Belize.
-Parents of one and two years olds – increasing Child Tax Credit by £4 a week from 2012.
-Higher winter fuel allowance payment guaranteed for another year, paid for by closing down tax loopholes.
Link to HM Treasury Budget website: http://www.hm-treasury.gov.uk/budget2010.htm