Read the New Statesman team’s analysis of the Chancellor’s last Budget before the election:
- Stephen Bush responds to the top lines in the Chancellor’s Budget
- Anoosh Chakelian gives her take on Ed Miliband’s rebuttal
- Tim Wigmore on why raising the personal tax allowance is a tax giveaway to the rich
- Jon Elledge explains why Osborne’s Help to Buy ISA is no good for first-time buyers
- Harry Lambert on May2015 defines the terms and highlights the difference in the parties’ definitions of ‘deficit’
And here’s what George Osborne announced:
ISA and a slice
New fully flexible ISAs, giving you complete freedom to take money out, and put it back in later in the year, without losing any tax-free entitlement.
A Help to Buy ISA: for every £200 first-time buyers save for their deposit, the government will top it up with £50 more.
Personal savings allowance
A move coming in next April for the first £1,000 of interest earned on savings to be tax-free – it would apparently take 95 per cent of taxpayers out of savings tax altogether.
Income tax allowance rise
The income tax threshold will go up to £10,800 in 2016 and then to £11,000 in 2017.
The threshold at which people start paying the top rate of tax will rise above inflation to £43,300 by 2017/18. This is the first time in seven years this hasn’t just risen with inflation.
The road back from Wigan Pier
George Osborne, clearly trying to rebuff Labour’s attack that Tory cuts would take us back to Thirties spending levels, changed his tune. He announced that the public spending squeeze projected in his Autumn Statement last year will end a year early.
This would see national income as a percentage of GDP reach the same level as 2000, rather than the Thirties; Osborne’s target for a surplus has gone down from £23bn by 2020 to £5-7bn.
Give and take for pensioners
The government is to reduce from £1.25m to £1m the lifetime pension allowance that tax relief can be claimed on.
Pensioners will be allowed their annuities, without having to pay punitive tax charges of at least 55 per cent.
Allow police and firefighter widows to remarry without facing a pension penalty.
Google tax
Osborne claimed that all the new measures against tax avoidance and evasion will raise £3.1bn over the forecast period. He also announced a review into deeds of variation as an inheritance tax loophole.
Reducing national debt
The Chancellor announced new OBR statistics suggesting that national debt as a proportion of GDP is falling this year, a year earlier than predicted.
He said the “central judgement of this Budget” is that resources from the bank sales, lower interest payments, and lower welfare bills will be used to pay down the national debt.
Growth is up
The Chancellor announced that the OBR has revised up its forecast for GDP growth this year, from 2.4 per cent to 2.5 per cent.
Energy expenditure
Cuts in taxes on the North Sea oil industry, which amount to £1.3bn.
“Giving more power to Wales”: the government is working on a Cardiff city deal and opening negotiations on the Swansea Bay Tidal Lagoon subsidy levels.
Student support
Additional financial support, following Autumn Statement announcement for postgraduates, for PhDs and research-based Masters degrees. Loans up to £25,000 will be available for them.
Confirming Lib Dem mental health reforms
Funding for a major expansion of mental health services for children and those suffering from maternal mental illness.
Devolution
100 per cent business rate growth to be kept for Manchester Combined, Cambridge and surrounding councils. Other councils are welcome to approach the Treasury to secure a similar deal.
Out with the tax returns
Online tax accounts will be launched, ending the use of paper tax returns.
A new pound
A 12-sided pound coin is unveiled, to avoid counterfeit. It has a prominent thistle on it.
Trumpeting creative funding
New tax credit for orchestras.
More generous TV and film tax credits.
Expansion of support for the video games industry.
A new horse race betting right to support British racing.
A consultation into tax support for local papers.
The Internet of Things
Investing in the “information revolution”, connecting up everything from urban transport to medical devices to household appliances.
Drinks on me!
Cutting beer duty by 1p.
Cider duty down by 2 per cent.
Scotch whisky and spirits down by 2 per cent.
Wine duty frozen.
But don’t drink and drive
Cancelling the fuel duty increase scheduled for September.
Infrastructure
A new rail franchise for the southwest, with £7bn of investment in roads and air links.
Expanding broadband vouchers to more cities, committing to a national ambition to 100 megabits per second to nearly all homes.
Confirming first twenty housing zones, and creating eight enterprise zones.
Charity fundraiser
Libor fines will contribute a further £75m to charities for the armed services, including a memorial for Afghanistan veterans. There will also be £1m put aside to celebrate the 600th anniversary of Agincourt. £25m will be provided to help the UK’s eldest veterans, including nuclear test veterans.
Charities will be able to claim automatic Gift Aid on the first £8,000 of small donations, up from £5,000.
A call to farms
Farmers will be allowed to average out their income over five years for tax purposes.
Fixing the roof
Trebling funding for church roof appeals.
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