Budget 2011
Opinion.
As predicted from recent experience,(see below),and well before any
exit polls, the difficult and "unavoidable" choices facing the UK voter
in the recent election has led to no majority political party in power -
a hung Parliament. Unsurprising. Since the late 1980's Britain seems to
favour left of right and right of left, pluralist governments. A move
to the center in line with the trends in social demographic attitudes
post PM Thatcher. David Cameron & Nick Clegg have wisely recognized
this trend and formed an ambitious Coalition Government or 'Con-Dem',
some sneer, with many challenges ahead. Labour in turn now have the
challenge of freshening up their now all washed up 'New Labour Project'.
While the Nationalists wait for the economic wind to change, but
increasingly realise, their being way too idealistic in times of public
spending cuts, and their best bet lies in a federalist UK project,
(possibly even including the Republic of Ireland), a United States of
the British Isles. Another PM Blair project muted but quietly dropped.
An independent audit of government public spending to commence 17th May 2010 with a view to big cuts in spending.
The VAT Rate of 20% from 4th January 2011, was an "arithmetical certainty".
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Labour Budget 2010
'The Pre-Election Double Dip Avoiding Recovery Budget'
Alistair Darling delivered his Budget
24 March 2010 at 12.30pm.
Dependent
on the election result, we could end up going through the whole Budget
process again as early as this June. The current Chancellor produced
'better than expected' economic figures supporting his interventionist
policies to stop the current recession. He also seemed to tax the rich
more to fund the financially hard pressed elsewhere. Ironically, all set
against a background of industrial strife and strikes, cuts in both the
Private Sector, (pay), and Public Sector (jobs). If elected, the
current Shadow Chancellor will inevitably want to introduce emergency
fiscal measures. These more in tune with his own political party's
politics of free enterprise, low corporation tax, individualism, cuts
in "Nanny State" government, the promotion of the traditional family
etc. The upcoming General Election seems to be a stark choice between
continuing the current interventionist policies in recession; or; as the
leader of the opposition put it telling the market place: "Britain is
open for business.". It ought simply to be about the chosen mix for UK
economic growth via more interventionism or more free enterprise from
the electorate's standpoint here. As ever it was really that simple of
course! Every politician agrees on one thing though- cuts in public
services. Hung UK Parliament anyone?
Summary
In
today's Budget, the Chancellor confirmed already-announced plans he
will increase income tax for high earners and add 1% to NI. The new taxes will largely affect those earning over £100,000, the top 2% on earners.Darling says tax increases for the wealthy are not "driven by dogma or ideology".
Despite speculation he would increase VAT to 20%, Alistair Darling says he will not make any change to the current 17.5% rate.
2
year Stamp Duty holiday for properties costing under £250,000.
Qualifying first time buyers only.The measure will be paid for through
an increase in stamp duty to 5% for homes priced at £1 million and
above, (hitting those mainly in the South East / London area of
the UK) effective midnight Wednesday.
The inheritance tax threshold is frozen at £325,000 for a further four years.
The
chancellor announced a £2.5 billion one-off growth package to help
small businesses and invest in key skills. New measures to force Lloyds
and RBS to issue £94 billion of new business loans were also announced. A
new growth fund of £200 billion for small businesses unveiled for
coming financial year. Annual investment tax allowance for small
businesses doubled to £100,000 and entrepreneur tax relief threshold
increased to £2 million.
The rate of capital gains tax has remained fixed at
18% and the
lower effective rate of 10% for entrepreneurs disposing qualifying
business interests has been expanded by doubling the lifetime allowance
from £1million to £2million with effect from 6 April 2010.
There was also a pleasing announcement from HMRC of
an intended “single view facility” for businesses by the end of 2011,
enabling current tax liabilities or repayments across all the main taxes
to be viewed together and managed in one place.
