Budget 2015: Summary of key points
George Osborne is presenting 2015’s Budget, the final one of this parliament, from the House of Commons. Here are the key takeaways from his speech:
• Today I report on a Britain that is growing, creating jobs and paying its way. We took difficult decisions in the teeth of opposition, and today Britain is walking tall
• The latest projections show living standards will be higher than when we came into office. As a share of national income, the deficit is down by more than a half. We set out a plan and that plan is working. Do we turn to the chaos of the past or return to plan that is working for you.
• We will use whatever resources we have to get the deficit down. This is a Budget that takes Britain on one big step on the road from austerity to prosperity.
Growth and economics
• Growth in 2015 will be 2.5pc, according to the Office for Budget Responsibility. This compares to 2.4pc predicted in December and 2.1pc a year ago.
• The economy will expand by 2.3pc for the next three years after, then 2.4pc in 2019.
• Inflation is due to fall to 0.2pc this year. In December it was forecast at 1.2pc.
Borrowing and spending
• The Government will increase the number of long-term gilts to be sold, to “lock in” low borrowing rates. Many historic debts will be paid off. But Osborne says Gordon Brown’s will take a lot longer
• Lower borrowing will be used to pay down the debt, not for a giveaway, Osborne said.
• Debt as a percentage of GDP will fall in 2015-16 for the first time since 2001. It will be 80.4pc in 2014-15 and 80.2pc in 15-16. By 2019-20 it will have fallen to 71.6pc.
• Public borrowing forecasts have been revised down from £91.3bn to £90.2bn in the current fiscal year since December, while 2015-16’s numbers have been cut from £75.9bn to 73.5bn. Then £39.4bn, and £12.8bn in 2017-18
• In 2019-20 there will be a £5.2bn surplus, and in 2019-20 £7bn
• As a percentage of GDP, the deficit will be 5pc this fiscal year, then 4pc, 2pc, and 0.6pc. After that, a 0.2pc surplus in 2018-19, then 0.3pc the year after
• Spending cuts of £30bn by 2017-18 come from £13bn government departments, £12bn of welfare savings and £5bn clamping down on tax evasion and avoidance
• Unemployment will fall from 5.7pc now to 5.3pc at the end of 2015. In December, the OBR forecast it would be 5.4pc at the end of this year, and a year ago it said 6.5pc.
• This is down 3 percentage points from what the Coalition inherited. 1,000 jobs have been created a day.
• Minimum wage to rise to £8 by the end of the decade
Savings and Pensions
• The pensions lifetime allowance, which Osborne says is unsustainable, will be cut from £1.25m to £1m. It will affect less than 4pc of people, the Chancellor says.
• Savers won’t have to pay any tax on interest on the first £1,000, or £500 for higher-rate taxpayers
• New Help to Buy ISA, every £200 saved leads to a Government top up of £50.
• ISAs will be made more flexible, to allow savers to keep tax benefits when they take money out and put them in.
• Personal tax free allowance rises to £10,800 next year and £11,000 the year after. A tax cut from 27m people.
• 40p rate climbs to £43,300 in 2017-18
• Osborne says he wants to eventually raise tax free allowance to £12,500 and 40p rate to £50,000
Corporation tax cut to 20pc from next year, and simplified to cut relief on foreign branches
• Tax loopholes being closed will raise £3.1bn
• Annual tax return abolished, with details uploaded automatically online
Duties on fuel, alcohol, tobacco and gaming
• Cancel fuel duty increase for petrol. Osborne says £10 off a tank with the Tories
• Cutting beer duty by a penny off a pint, cider duty down 2pc, whisky and spirits by 2pc, wine duty frozen
• No changes on gaming or tobacco
• Double UK Trade and Investment’s resources for Britain’s exports to China
• £1.3bn of support for the oil and gas industry through a series of tax cuts to petroleum revenue levies, supplementary charges and a tax allowance.
• This will increase production by 15pc by the end of decade according to the OBR
• Launches a sale of £13bn of UK Asset Resolution mortgages. This is the “bad bank” of bailed out Northern Rock and Bradford & Bingley
• £9bn of Lloyds shares will be sold this year
• The bank levy will be raised from 0.156pc to 0.21pc, raising £900m a year
• A comprehensive transport strategy for the North to help create a Northern Powerhouse
• Business rate receipts devolved to Manchester, and offer to do the same to Cambridge
• Eight enterprise zones across Britain, with new ones in Plymouth and Blackpool
SOURCE: The Telegraph
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