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21.3.2011 - The UK Budget 2011 (Summary, Highlights and Key Points)

Posted by Ben Williams on Wed, Mar 23, 2011 @ 08:41 AM

So, the long-awaited Budget 2011 as been delivered. Here you will find all the key points that George Osbourne mentioned.

Click here to see a more in-depth article about the main points of the Budget 2011.

 Or, to learn more about the Budget in great detail, and read the full UK Budget 2011, click here.

· Today's budget "is about the reforming the economy so we can have enduring growth for the future".

 

· "This is not a tax-raising budget. This is a budget based on sound money."

 

Fuel, Cigarette and Alcohol Duties

· 1p removed from fuel duty, as of 6pm tonight

· Planned inflation rise in fuel duty delayed until 2012

· Annual 1p above inflation 'fuel escalator' rise scrapped until 2015

· Fair fuel stabiliser introduced - 20% tax on profits of oil companies to increase to 32%, expected to raise £2bn extra. This will fund the fuel measures.

· VAT on fuel will not be reduced

· No further changes to alcohol duties, but 2% above inflation rise in excise duties for wine, spirits and beer to go ahead.

· Tobacco duty rates up by 2% above inflation

Income Tax

· No personal tax increases

· Personal tax allowance to rise by £630 to £8,105 in April 2012 - a real increase of £48 a year, or £126 in cash terms.

· Consultation on merging of national insurance contributions and income tax.

· Reviews launched of the revenue raised by the 50p tax rate and the taxation of very high-value property.

· Direct tax rates to be indexed to Consumer Price Index from 2012.

UK Economy

· Annual forecast for 2011 revised down to 1.7%, from 2.1%, due to weaker final quarter growth in 2010.

· 2012 growth forecast also revised down, from 2.6% to 2.5%.

· Inflation set to stay between 4% and 5% in 2011, will drop to 2.5% next year.

Borrowing

· Borrowing for this year to be £146bn - below the government target. Borrowing will fall to £122bn next year, then £101bn in 2012-13, £70bn in 2013-14, £46bn in 2014-15 and £29bn in 2015-16.

· National debt forecast to be 60% of national income this year, rising to 71% in 2012 before falling to 69% by 2015.

Other Taxes and Allowances

· 43 tax reliefs abolished to simplify the system.

· Measures to close tax loopholes will raise £1bn a year.

· From April 2012, people leaving 10% or more of their estate to charity will enjoy 10% reduction in inheritance tax, benefiting charities by £300m.

· Plans to switch air passenger duty (APD) from passengers to planes have been dropped. This year's APD rise is postponed for a year, and the government will seek to impose the tax on private jets.

· Charge on non-domiciled taxpayers to increase from £30,000 for those here for seven years to £50,000 for those in the country for 12 years, raising more than £200m.

Housing

· £250m to help first-time buyers purchase newly-built homes.

· Support for mortgage interest scheme extended for a year.

Help for Business

· Small business rate relief holiday extended by one year to October 2012 at a cost of £370m.

· Corporation tax to be reduced by 2% from April, to fall eventually to 23% - the lowest corporation tax among the G7 industrialised countries. Bank levy rate to be adjusted next year to offset the effect of corporation tax reduction on banks.

 

· Small companies' research and development tax credit to rise to 200% in April and 225% in 2012.


· Entrepreneurs relief scheme to be doubled to £10m from 6 April.


· 21 new enterprise zones to be funded, including in Manchester, Birmingham and London. Ten others to be named in the summer.

 

· Help for manufacturing to include new export credits, a technology and innovation centre and nine new university centres.


· Gift aid benefits up from £500 to £2,500 as the system is simplified.

 

· Income tax relief on enterprise investment scheme to increase from 20% to 30%.

 

Jobs and Skills

 

· Funding for 40,000 new apprenticeships for young unemployed.

 

· Number of places on a new work experience scheme to increase to 100,000 over two years, rather than 20,000 as previously announced.

 

· Investment of £100m in new science facilities in Cambridge, Norwich, Harwell and Daresbury, funded from bank levy.

 

· New funding to double the number of university technical colleges from 12 to at least 24.

 

Pensions

· New single tier pension, worth £140 a week, would not apply to current pensioners.

· Government to seek automatic mechanism for future increases in state pension age, based on regular reviews of longevity.

Transport

· Investment of £200m in regional railways.

· £100m to help councils repair potholes.

Green Measures

· The UK to become the first country in the world to introduce a carbon price floor for the power sector.

 

· £2bn more for green investment bank to start operating in 2012, one year earlier than planned.

 

· Climate change levy discount on electricity for those signing up to climate change agreements will rise from 65% to 80% from April 2013.

 

Other Announcements

 

· Additional cost of military measures will be met from Treasury reserves.

 

· Three forms of land tax evasion to be closed down.

 

· Pay rise of £250 for armed forces, prison, NHS, teachers and civil servants earning under £21,000.

 

· All planning bodies to prioritise growth. Default answer to development will be "yes".

 

Click here to see a more in-depth article about the main points of the Budget 2011.

 

Or, to learn more about the Budget in great detail, and read the full UK Budget 2011, click here.

 

You can also learn more about how the changes in income tax will affect you by clicking here.

Topics: UK Budget 2011, Budget 2011, Budget summary 2011, Budget Highlights 2011