VIDEO: BUDGET 2015 - Key things you need to know
The Chancellor cautioned voters there would be “no gimmicks, no giveaways” in his pre-election budget - but he delivered good news for drinkers, motorists, savers and first time buyers.
George Osborne confirmed tax cuts via a rise in personal allowances, cut beer, cider and spirit duties, and again scrapped the fuel duty rise.
He announced a new personal allowance which would mean 95% of all savers savers would pay no tax on their savings.
A new help-to-buy ISA is to be launched, which will see the Government add £50 to every £200 first-time buyers put away towards a deposit.
HERE ARE SOME OF THE HIGHLIGHTS OF TODAY’S BUDGET:
* Beer duty to be cut, with 1p off a pint. Cider duty to be cut by 2%. Duty on scotch whisky and other spirits to be cut by 2%. Wine duty frozen.
* Fuel duty increase planned for September is cancelled.
* National Minimum Wage to rise by 20p an hour - to £6.70 - from October.
* Personal tax-free allowance will increase to £10,800 in April 2016 and to £11,000 in April 2017.
* A “Help to buy ISA” launched for first-time buyers. For every £200 saved for a deposit, the Government will top up by £50.
* Pension pot lifetime allowance reduced from £1.25m to £1m from next year.
* Annual tax return to be abolished altogether.
* Corporation tax to be cut to 20% in a fortnight..
* Employers’ National Insurance contributions for under-21s to be abolished from April, and for young apprentices from April next year.
* Class 2 National Insurance contributions for the self-employed to be abolished next parliament.
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The Chancellor declared Britain could finally “walk tall again” after the years of austerity and he said said the “the sun is starting to shine” as the period of austerity would end a year earlier than forecast.
But Labour leader Ed Miliband, responding to the Budget speech, said there had never been such a large gap between the Chancellor’s rhetoric and the reality of people’s lives.
He condemned Mr Osborne for failing to mention investment in the NHS or public services.
And he told MPs: “This is a Budget people won’t believe from a Government that is not on their side - because of their record, because of their instinct, because of their plans for the future.”
But the Chancellor claimed the Government’s economic strategy was paying off.
To Tory cheers he announced that he would meet his promise made in 2010 that debt would be falling as share of national income by the end of the parliament.
He said that a combination of lower welfare bills, falling interest rates, and further sales for the bailed out banks meant borrowing was set to fall faster than forecast.
“The hard work and sacrifice of the British people has paid off. The original debt target I set out in my first Budget has been met,” he said.
“We will end this parliament with Britain’s national debt share falling. The sun is starting to shine - and we are fixing the roof.
“Because the national debt share is falling a year earlier than forecast at the Autumn Statement - the squeeze on public spending ends a year earlier too.
“In the final year of this decade, 2019-20, public spending will grow in line with the growth of the economy.
“We can do that while still running a healthy surplus to bear down on our debt.”
In a nod to the May 7 poll, he said Britain was facing a “critical choice” as he highlighted economic successes.
Mr Osborne said the Office for Budget had ticked up its growth forecast for this year - to 2.5% compared to the 2.4% it was predicting at the time of the Autumn Statement in December.
Growth will also be slightly higher next year at 2.3% as against a previous forecast of 2.2%, he said.
He told MPs: “Today, I report on a Britain that is growing, creating jobs and paying its way. We took difficult decisions in the teeth of opposition and it worked - Britain is walking tall again.”
He said that after a collapse greater than almost any country five years ago, in the last year the UK has grown faster than any other major advanced economy.
He went on: “Five years ago, millions of people could not find work. Today, I can report: more people have jobs in Britain than ever before.
“Five years ago, living standards were set back years by the Great Recession. Today, the latest projections show that living standards will be higher than when we came to office.
“Five years ago, the deficit was out of control. Today, as a share of national income it is down by more than a half.”
And he added: “The critical choice facing the country now is this: do we return to the chaos of the past? Or do we say to the British people, let’s go on working through the plan that is delivering for you?”
He said the OBR was predicting that debt as a share of GDP will fall from 80.4% in 2014-15 to 71.6% in 2019-20.