Chancellor's budget to unveil higher tax allowance
Wednesday, 23 March 2011 08:17
George Osborne is set to announce today in the budget that the income tax threshold will increase by about £600 from April 2012.
This will increase take home pay for around 25 million people by £45 a year. It comes in addition to the increase in the personal allowance that will apply from April 6th this year of £1,000 taking the personal allowance to £7,470.
The coalition government has pledged to increase the tax-free personal allowance figure to £10,000 by the time the end of its first term in office.
The Chancellor will also reveal details of a £250 million plan to help 10,000 first-time buyers purchase newly built homes. House or flat purchasers would put up five per cent of the cost and the government and builders would both put in ten per cent.
This will serve to give a boost to the construction industry as well as helping first-time buyers. The number of people buying their first property has dropped by half since 2004/5, from around 700,000 to just 347,000 last year.
Other measures that are expected to be announced include the planned hike in fuel duty will be scrapped and a private jet tax will be presented.
It is also expected that the forecast for UK economic growth for 2011 will be downgraded. In November the Office for Budget Responsibility (OBR) predicted that UK growth for 2010 would be 1.8 per cent. In the end it was just 1.4 per cent.
It is also likely that estimates for public sector borrowing could be revised upwards; though the figure for this year is likely to come in at several billion lower than the target of £148.5 billion.
Put your questions to our experts as they analyse the budget in a live webcast from 1.30pm today.
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