The key measures from today’s Autumn Statement.
The key measures from today’s Autumn Statement
Fuel duty to be frozen
Sovereign wealth fund for north of England to keep benefits of shale gas exploration
ISAs to be transferrable to partners tax free
55 per cent death tax passed on to loved ones abolished
Isa threshold increases from £15,000 to £15,240 next April
Personal tax allowance to increase to £10,600 next April
Air Passenger Duty to be scrapped for under-12s from 1 May next year and for under-16s the following year
World War One debt to be repaid
Inheritance tax to be cut for families of aid workers who die in course of duty
Libor fines to support Ghurkhas and their families
VAT paid by hospices and search and rescue organisations to be refunded
Introduce 25 per cent tax on profits generated by multi-nationals that are shifted out of the UK, set to raise £1bn over five years
Bank profits which can be offset by losses for tax purposes to be limited to 50 per cent
New £90,000 charge for non-doms resident in the UK for 17 of the past 20 years.
Welfare spending to be £1bn lower than forecast in March
Two year freeze in working-age benefits (first announced in October)
Migrants to lose unemployment benefits if they have “no prospect” of work after six weeks
£2bn extra every year until 2020 for the NHS
GP services to get £1.2bn in extra funds from bank foreign exchange manipulation fines
Employment Allowance extended to carers
£10,000 loans for postgraduate students studying for masters degrees
Business rates to be reviewed
Theatre tax break extended to orchestras
Research and development tax credit increased for small and medium-sized firms
New tax credit for children’s TV producers
£45m package of support for exporters
Expand tax relief on business investment in flood defences
Old pacer carriages on Northern Rail and the Trans-Pennine Express replaced with new and modern trains
£1.5bn for 84 roads projects in England
£2bn for flood defence schemes
Overall the top 10 per cent are losing out the most, but beyond that it’s the poorest who are hit the hardest, largely due to changes taking place in the benefits system.
The rabbit that came out of the hat: stamp duty
Designed to help those at the lower end of the property ladder (and to counteract the political appeal of Labour’s mansion tax), the reform of residential stamp duty will mean that stamp duty is from tonight paid at the following rates:
0% up to £125,000
2% up to £250,000
5% up to £925,000
10% up to £1.5m
12% over £1.5m
The move will benefit 98 per cent of homebuyers who pay it, Osborne claims. Full details are available in the Autumn Statement document, but the important bit is here:
Sleights of hand
In his last autumn statement before the election, the chancellor said the economy would grow 3 per cent this year. However this year was the only year in which growth would reach 3 per cent. A closer look at the Office for Budget Responsibility’s (OBR) predictions, however, reveals that growth is forecast to be significantly lower (around 2 per cent) in the years ahead. The OBR is forecasting 3 per cent growth in 2014, 2.4 per cent growth in 2015, followed by 2.2 per cent, 2.4 per cent, 2.3 per cent & 2.3 per cent in the following four years.
Once again on Labour’s ‘out of control spending’, which George Osborne supported back in 2007 – see video:
‘£2 billion extra will be made available to the NHS’
In reality, £750m of the £2 billion is money that is simply being re-allocated from within the Department of Health. In other words, it isn’t new money that is being plowed into the NHS; it’s money that is being moved around to give an impression of extra funding.
Ed Balls MP, Labour’s shadow chancellor, speaking ahead of the Autumn Statement, said:
“David Cameron and George Osborne have now failed every test and broken every promise they made on the economy.
“They promised living standards would rise, but while millionaires have got a huge tax cut working people are £1600 a year worse off under the Tories. This cost-of-living crisis is why the Chancellor will have to admit he has broken his promise to balance the books by next year.
“A Labour Autumn Statement would set out a better and fairer plan to deliver a recovery that works for the many and not just a few.
“Labour’s economic plan will raise the minimum wage, expand free childcare for working parents, get more homes built and cut business rates for small firms.
“We will balance the books in a fairer way, starting by reversing the £3 billion a year tax cut for the top one per cent of earners.
“And we will save and transform our National Health Service with a fully-funded long-term plan. We will raise an extra £2.5 billion a year to deliver 20,000 more nurses and 8,000 more GPs – a commitment the Tories refuse to match.”
Natalie Bennett, Green Party Leader, said:
“Chancellor George Osborne is continuing with his clearly false diagnosis of the source of Britain’s economic problems, so unsurprisingly his prescription is not going to cure the patient.
“Osborne’s suggestion that ‘disastrous decisions on spending and borrowing and welfare that got us into this mess’ are demonstrably false. What got us into ‘this mess’ is the fraud, errors and mismanagement of the financial sector. Urgent action is needed is to tackle the still out-of-control sector, the still too-big-to-fail banks and their hulking dominance of our imbalanced economy.
“What the coalition government needs to do is stop making the poor, the disadvantaged and the young pay for those bankers’ errors, and rebalance the economy so that it starts to provide jobs that workers can build a life on, while paying decent benefits to everyone who needs them.”
Alison Garnham, chief executive of Child Poverty Action Group, said:
“It’s striking that the only giveaway for children was for families who can afford to fly them abroad on holiday. For millions more children, today’s Autumn Statement is about staying the course for poverty rather than prosperity.
“The chancellor once again failed to mention child poverty – it’s now two years since an Autumn Statement or a Budget mentioned child poverty, despite the government’s binding legal obligation to reduce it and IFS projections warning that the Government is on course to rapidly increase, not reduce, child poverty.
“By cutting Universal Credit once again, the chancellor is in very real danger of torpedoing Iain Duncan Smith’s flagship policy. Freezing the work allowance will harm work incentives and hit low paid families hard. Two thirds of poor children live in working families; we should be redistributing help towards them, not away from them.”
More to follow…
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