The key points emerging from the Chancellor’s statement today are as follows:
ECONOMY – Most of the OBR’s growth indicators for UK have been revised up and inflation figures down. Unemployment to peak this year and decline each year to 6.3% by 2016 – a million jobs to be created over five years.
CORPORATION TAX – Cut to 24% from April and by 2014 it will fall to 22%.
VAT – Loopholes and anomalies to be removed – including removing exemptions for sports nutrition drinks and hot takeaway products in supermarkets. Existing exemptions will remain for food, children’s clothes, books and newspapers.
STAMP DUTY – Stamp duty on any homes bought through companies will be 15%.
ENTERPRISE LOANS – Government considering them for young people to start their own business.
ENTERPRISE ZONES – Better capital allowances for businesses setting up in new Scottish and Welsh enterprise zones.
RETAIL/SUNDAY TRADING – Relaxation of Sunday trading laws on eight Sundays during Olympics and Paralympics, starting July 22.
CONSTRUCTION SECTOR – Extra funding to help construction firms building new homes.
ENERGY – “Major package of tax changes” aimed at boosting oil and gas extraction in North Sea, and £3bn new field allowance west of Shetland.
AIRLINES – The expected increases in Air Passenger Duty were outlined in papers released by the Treasury. It was also confirmed that APD will rise again in April 2013, in line with inflation. Report on the future of aviation in south-east England to be published in the summer.
TRANSPORT – No change to existing plans on fuel duty. Vehicle excise duty to rise by inflation, but frozen for road hauliers. Existing fair fuel stabiliser means that above-inflation rises in fuel duty will return only if price of oil falls below £45 ($70) a barrel. Extend electrification of the Transpennine route between Manchester and Sheffield. Further improvements to the lines between Manchester and Preston, and Manchester and Blackpool.
BANKING – Bank levy to be increased to 0.105% from January 2013 “to ensure that corporation tax cuts do not benefit the banks”. The levy will raise £2.5bn a year.
There is a separate blog addressing the changes affecting the technology, telecoms and creative industries sectors.
BBC News Budget Special Coverage http://www.bbc.co.uk/news/business-17372581