George Osborne’s 2014 budget was focussed on strengthening the economic recovery with growth this year projected to be the strongest in any Western economy.
Based on the latest figures, unemployment rates dropped by 63,000 in three months to January. Meanwhile, business groups expect that UK economic output will exceed its pre-recssion peak in the second quarter of 2014.
Summing up his budget, Osbourne said that it would boost “makers, doers and savers”.
How does the Budget 2014 affect me? Let’s have a look at some of the main points:
PERSONAL TAX, PENSIONS and SAVINGS:
Personal allowance raised to £10,500 next year; average savings of £800
Higher rate threshold (40p income tax) rise from £41,450 to £41,865 next month and then by further 1 per cent to £42,285 next year.
Tax restrictions on pensioners’ access to pension pots removed
Scrapped: 10p starting rate of tax on savings income
LEISURE:
2% rise above inflation on tobacco duty
Alcohol duty escalator abolished
Beer duty cut by 1p per pint
Spirits and ordinary cider duty frozen
Bingo duty halved to 10%
Theatre productions to see 20% tax relief
TAX:
Planned rise in fuel duty in September scrapped
Inheritance tax scrapped for members of the emergency services
No VAT charged on fuel for air ambulances and rescue boats
Stamp duty on homes worth over £500k will rise by 15% if bought by a company for purposes of tax avoidance
ECONOMY and INVESTMENT:
GDP growth better than expected: 2.7% this year, 2.3% next, then 2.6%, 2.6% and 2.5% in the years following amount to £16 billion bigger than previous predictions
Deficit revised down to 6.6% this year
Debt revised down to 74.5% of GDP. Will peak next year but fall again the year after.
Borrowing to be £12 billion less than forecast
Support fund to build 200,000 homes
£140m found for flood defences
£200m found to fund pothole repair
Scheme to boost exports will see a double in finance to £3 billion
JOBS:
1.5 million more jobs over next five years
Earnings to grow faster than inflation
ENERGY:
£7 billion package to cut energy bills – in real terms saving families £15 a year