On Wednesday 20th March the Chancellor delivered the 2013 Budget. Below I have provided my comments and analysis.
Personal allowance in income tax
We saw good news for everyone in the form of a speeding up of our pledge to increase the personal allowance in income tax to £10,000. This will now happen from next April, meaning that the average taxpayer’s income tax bill will be £700 less than in 2010. This is particularly good news for my lowest paid constituents. This is on top of the increase coming into effect next month which will benefit over 33,000 people locally – and mean 3,255 have been taken out of tax completely.
Fuel duty escalator
For the fourth budget running, the Government has been able to find the money to cancel the planned 3p rise in fuel duty, something I have campaigned for since I was elected. This means that motorists will now pay 13p less than planned under Labour, so it’s great news for already hard-pressed constituents and businesses in Amber Valley.
Childcare tax breaks
Those who are finding the cost of childcare difficult in the current climate will get help from the Government. From Autumn 2015, the Government will offer tax-free childcare, meeting 20% of childcare costs for working families with children under 12 years of age. This will be worth £1,200 per child, and will save a working family with two children up to £2,400 per year.
Jobs and corporation taxes
We’ve seen good news for businesses and those currently out-of-work in Amber Valley, with the new Employment Allowance worth up to £2,000 for four employees. This will cut the National Insurance contributions of employers so that they are encouraged to take on extra staff. In addition to this, we’ve heard that Corporation Tax will be cut to the lowest levels in the economically developed world, meaning that Britain becomes a more competitive place in which to invest and create jobs.
Help to buy
I am also pleased that the Government has taken the decision to help those who want to get on to, or to move up, the housing ladder. Those who want to buy a newly-built home will be able to apply for up to 20% of the equity of the home, returned on the sale of the property. From January 2014, we will provide a new guarantee to help lenders offer more 80% to 95% value mortgages.
Our plan is working
I would describe the Chancellor’s statement on Wednesday as one which offered to help where we could, but one which also sought to level with the British people. Things are worse than we feared, but despite the challenges we have managed to clear a third – up from one quarter – of the structural deficit that we inherited from the reckless Labour Government.
Our plan is working, with a record number of jobs and record low interest rates as a result of Britain’s credibility in the markets due to our recommitment to deficit reduction. If we are to ensure that mortgage rates remain low for families and that we can continue to help in the ways we did on Wednesday, we must stay the course.
Beer duty escalator
As a final point, I’m sure that something we can all be glad about is the Chancellor’s decision to scrap the beer duty escalator and take a penny off the pint. I’ve been campaigning for this since I was elected, and it’s great news for local pubs, microbreweries, and drinkers.
Should you wish to make your own judgement about the Budget yesterday, you may read the full speech in Hansard here, and read more details from the Treasury web site here.