Here are the key business points from Alistair Darling’s first Budget. Check back here for updates, including the latest tax tables and allowances.
Key Budget Changes
- Borrowing in 2008/9 will rise to £43bn (2.9% of national income).
- The planned 2p rise in fuel duty will be postponed until October this year.
- Corporation Tax – main rate will be cut from 30% to 28%, as predicted.
- CGT taper relief will be abolished, and “Entrepreneurs’ Relief” will also come into play from April 2008.
- Next year, an extra £60m in funds will be provided for the Small Firms Loans Guarantee Scheme; all small companies will be eligible.
- Small firms will get better access to public sector contracts – with a target of 30% of all contracts within the next 5 years.
- There will be a £12.5m “capital fund” to encourage women entrepreneurs.
- Tax Avoidance – further measures will be announced today.
- The Chancellor plans to simplify taxes for small companies.
- The Cash ISA limit will be increased to £3,600 next tax year.
- Chancellor wants to encourage longer-term fixed rate mortgage deals in the future.
- Plans to discourage the use of plastic bags – legislation to come in 2009.
- From 2009, major reform of Vehicle Excise Duty with the introduction of new tax bands. From 2010, more polluting cars will pay higher taxes in the first year, the least polluting cars will pay no tax.
- Capital Allowances for business cars will also be reformed.
- Cigarettes up 11p.
- Alcohol Duty will rise by 6% above the rate of inflation.
- Income Tax (Basic Rate) will fall by 2p to 20p, and the 10% band will be scrapped from April 2008.