Budget 2012 – The Basics

By Ben Aulakh

• Top rate of income tax cut from 50p in every pound to 45p in every pound for those earning more than      £150, 000 a year.
• Tax free personal allowance to rise by £1100 to £9205 by 2013.
• Tax free personal allowance for pensioners frozen, due to inflation this equates to a real terms cut in pensions.
• Basic state pension to rise by £5.30 per week to £140 a week.
• Office for Budgetary Responsibility estimates growth of 0.8 per cent this year, rising to 2 per cent next year, 2.7 per cent in 2014, and 3 per cent in 2015/2016.
• Government borrowing for 2012 estimated at £126 billion, Chancellor estimates this will fall to £120 billion next year, £98 billion in 2014 and £79 billion in 2015/2016.
• Stamp duty on properties costing more than £2 million up by 2 per cent to 7 per cent.
• Corporation tax cut by 2 per cent, banking levy raised from 0.8 per cent to 0.105 per cent.
• Five per cent increase in the duty on cigarettes, 37 pence increase on the price per packet.
• Fuel duty remains unchanged, however in real terms it will rise 3 pence in line with inflation.
• Government forecast creation of 1 million jobs over the next five years
• Government identified need for £10 billion in welfare savings.