Wednesday 23 March 2011

Budget 2011

Highlights include:

Forecasts

  • 2011 growth cut to 1.7% (from 2.1% forecast in Nov) 
  • Borrowing £146bn this year, £122bn next year. 
  • Inflation to remain between 4-5% for the rest of the year. 
  • Borrowing to be 146 bn this year, 122 next, then 111 and predicted to be 29bn by 2015-16. 
Tax

  • Personal tax allowance to rise a further £630 to £8,015 in April 2012 
  • 50% tax threshold is temporary measure. 
  • 43 complex tax reliefs abolished. 
  • From April 2012 indexation assumption for direct taxes will move to Consumer Prices Index. 
  • Consultation on merging NI and Income tax. 
  • Tax avoidance clampdown to raise £1bn this year. 
Business

  • Corporation tax reduced by 2% and then further 1% three years after that 
  • In Plan for Growth, £350 million worth of business regulations will go. 
  • Lots of planning changes including reclassification of land and time-limits on applications 
  • Income Tax relief on Enterprise Investment Scheme to increase from 20% to 30% in April 2011. 
  • From April small companies R&D tax credit will rise 220% this year and 225% next year 
  • Commitment to improve the intellectual property regime. 
  • Enterprise Zones: 21 in total, 10 initially. Businesses inside zones get 100% discount on rates and superfast broadband 
  • Further 10 announced in the summer – LEPs asked to come forward with proposals. 
  • £100m funding for science facilities 
Green
  • Green investment bank will begin work one year early in 2012, with an extra £2bn in funding. 
  • Introduction of a new carbon price floor. 
Skills
  • Funding for 12 further university technical colleges 
  • Extra 40,000 apprenticeships for young people out of work 
  • Funding for 100,000 new work experience placements 
Big Society
  • Gift aid cap increased from £500 to £2,500. Also 10% off inheritance tax discount if you leave 10% of an inheritance to charity.

    Budget 2011

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