Budget 2013: The Headlines

The following was provided by the Conservative Party in summary of the Budget 2013.

In a tough economic situation, the British people know there are no easy answers or short cuts. But we are succeeding, slowly but surely, in fixing those problems.

We’ve now cut Labour’s record deficit by not just by a quarter – but by a third.

We’ve helped create 1.25 million new private sector jobs.

Interest rates remain at record lows.

Income tax

The amount people can earn before paying income tax – the personal allowance – will rise to £10,000 in April 2014 lifting 2.7 million out of tax altogether.

Labour wants to reintroduce the 10p tax band that they abolished. Conservatives in Government have now turned Labour’s 10p tax band into a zero pence tax band. Every person paying tax at the 10p rate when Labour doubled it will now be paying no income tax at all on that income.

Beer duty

The Chancellor has scrapped Labour’s plans to increase beer duty in today’s Budget, and instead cut it by a penny, meaning beer will be 1p per pint cheaper after Sunday night – 4p per pint cheaper than it would have been under Labour. Beer duty increased from 10.82 per cent in 1997 to 17.32 per cent in 2010, an increase of 60 per cent.

Businesses

A new Employment Allowance will take £2,000 off the National Insurance bill of every employer – open to businesses, charities and community amateur sports clubs.

Employers will be able to hire one extra person on £22,400 a year, or four people working full time on the minimum wage, without paying any National Insurance.

A further corporation tax cut to 20 per cent in April 2015 will see the UK having the lowest corporation tax rate in the G20.

Fuel Duty

The Chancellor has cancelled Labour’s fuel duty increase planned for September 2013 altogether

Pump prices will now be 13 pence per litre lower than if Labour were in power. For a Vauxhall Astra that is £7 less every time families fill up the tank – or £9 less for a Mondeo. A van driver will save £340 per year and a haulier will save £5,200 per year.

Fuel duty will now have been frozen for nearly three and half years – the longest freeze in duty for over 20 years.

Childcare

The Government has introduced Tax Free Childcare. It is giving people 20% off, equivalent to the basic rate of tax, on the first £6,000 of their childcare costs for each child.

Help to Buy

We’re supporting people who want their own home, but can’t afford the increased deposits that lenders now require. We’re using the Government’s fiscal credibility to support a Mortgage Guarantee to help lenders offer mortgages to people with a deposit of between 5 per cent and 20 per cent. This should dramatically increase their availability.