29 May 2024, 04:11
By Furniture News Mar 16, 2016

George Osborne delivers eighth Budget as chancellor

Chancellor of the Exchequer George Osborne delivered his eight Budget today, with some of the main points outlined as such:

Business

- The headline rate of corporation tax, which is currently at 20%, will fall to 17% by 2020

- Anti-tax avoidance and evasion measures are to raise £12b by 2020

- The yearly threshold for small business tax relief is to be raised from £6000 to a maximum of £15,000, which will exempt thousands of firms

- £9b is to be raised by closing corporate tax loopholes and tax minimisation schemes

- The use of 'personal service companies' by public sector employees to reduce tax liabilities is to end

- Commercial stamp duty will have a 0% rate on purchases of up to £150,000, 2%  on the next £100,000 and a 5% top rate above £250,000. There will be a new 2% rate for high-value leases with a net present value of above £5m

Economy

- Growth forecasts have been revised down for the next three years – growth forecast to be 2% in 2016

- GDP is predicted to grow 2.2% and 2.1% in 2017 and 2018

- The UK is expected to grow faster than other Western economies

- 1m jobs to be created by 2020

- Inflation of 0.7% is forecast for 2016

Public borrowing/deficit/spending

- Spending cuts of £3.5b by 2020

- Spending as a share of GDP to fall to 36.9% by 2020

- Debt to be £9b lower in 2015-16 in cash terms

- The deficit as a share of GDP is expected to fall to 2.9% in 2016-17, 1.9% in 2017-18, and 1% in 2018-19

Personal tax

- Threshold at which people pay 40% tax will rise from £42,385 to £45,000 in April 2017

- Tax-free personal allowance is to rise to £11,500 in APpril 2017

- 0.5% rise in insurance premium tax

Pensions and savings

- The annual ISA limit is to rise from £15,000 to £20,000

- New 'lifetime' ISA to be put into place for under-40s, with Government putting in £1 for every £4 saved

- New state-backed savings scheme for low-paid workers to be launched, which is worth up to £1,200 over four years

Further details on the Budget to come.

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