Budget for the Righteous

If you smoke, drink and drive fast cars then the 2008 Budget will have upset you because the headlines are:

Fags up 11p
Beer up 2p
Car tax will rise to £950 in 2011 if you drive a Chelsea Tractor type vehicle.

For the rest it was a non-budget, everything that's going to happen from April 2008 was announced by Gordon Brown last year with just a few tweaks made.

If you run a small company then there is a bit of good news - the threatened taxing of spouses who take dividends, at 40% instead of 20% , was deferred until 5th April 2009.

The headlines are :

CIGARETTES AND ALCOHOL

• Cigarettes up 11p a packet of 20 from 1800 GMT; five cigars up 4p.

• Beer up by 4p a pint, wine 14p a bottle, spirits 55p a bottle and cider 3p a litre by Sunday.

• Duties on alcohol will go up by 2% above inflation for next four years.

CARS, FUEL AND ROAD PRICING

• From 2009, major reform of the vehicle excise duty. For new cars from 2010, the lowest-polluting cars will pay no road tax in the first year. Higher-polluting cars will pay more.

• Funding set aside for road-pricing proposals.

• 2p increase in fuel duty is postponed until October this year.

• For environmental reasons, fuel duty will rise by 0.5p per litre in real terms in 2010.

HOUSING

• From April, key workers, such as teachers and nurses, will be able to borrow money from shared equity schemes.

• Stamp duty on shared ownership homes will not be required until people own 80% of their home.

• More people should have the chance to have a long-term fixed mortgage, which a report shows can reduce the risks for first-time buyers and can keep them on the housing ladder.

• Sites for 70,000 more houses have been identified.

PENSIONERS

• Winter fuel allowance will go up from £200 to £250 for the over 60s and from £300 to £400 for the over 80s.

BENEFITS

• From October 2009, rules for housing and council tax benefit will mean families on benefit are better off in work.

• From April, 2009, child benefit will be increased to £20 a week.

• From April 2010, all long-term recipients of incapacity benefit will attend work capacity programmes.

BUSINESS

• Corporation tax will fall from 30% to 28% by April this year, but rise to 21% for small companies.

• Funds available through the small firms loans guarantee will increase by 60% in the next year.

• There will be a capital fund of £12.5m to encourage more women entrepreneurs.

AIRPORTS AND AIR TRAVEL

• New measures at Heathrow and other airports, using biometric technology, to speed up the time it takes to get through security checks.

ENVIRONMENT

• Laws will be introduced by 2009 to tax plastic bags if shops do not do more to charge for their use.

• £26m to help make homes greener.

• The government is asking the European Commission for tougher targets on car fuel emissions

EDUCATION

• There will be £200m extra for schools to raise GCSE results. By 2011, every school "will be an improving school".

• There will be a £30m fund to improve science teaching.

POVERTY

• Five million customers on pre-paid meters should get a "better deal". Energy companies should spend £150m on social tariffs.

• £17 more a week for poor families with one child.

• A family with two children earning up to £28,000 a year will be £130 a year better off. A further £125m to be spent over the next three years to help families.

SAVINGS

• The government will launch the "savings gateway" nationally with the first accounts available by 2010.

• Cash ISA limit confirmed as £3,600 a year from April.

If you would like further information on any aspect of the budget please call Haydn Pyatt on 01527-521717

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