“This is the budget for Britain. The comeback country” – George Osbourne 2015
On March 18 George Osbourne revealed his 2015 budget plan in its entirety. Here we take a look at some of the key points of the 2015 UK Budget.
The UK economy has been forecast to grow by 2.3% in 2016 before reaching 2.4% by 2019. These stats are great news for the chancellor, however he is being careful about talking too much about the growth. This is to ensure that the voters don’t believe all his economic work has already been completed.
Inflation forecast is at 0.2% for the next 3 years. This is another factor that aides the Chancellor. This means that he will lower the interest of public debt. However, he is still well-below the target of 2% inflation.
Over the next 5 years, £5.3bn extra taxes are to come from the banking sector. This is because the banks have stopped claiming relief on compensation claims as well as the bank levy. This is expected to bring £2.9bn in revenue per year and will increase to 0.21% – bringing in an extra £900m. Money that is raised from bank sales will be utilised to pay off national debt.
The Chancellor is able to say that his target has been met effectively: getting the national debt share to fall by the end of parliament. However it is a year later than previously expected.
Borrowing is to be at £150bn at the beginning of this parliament. Surplus will reach £5bn. This huge fall in surplus means that there will be less opportunity for hand-outs in the future.
The lifetime allowance has been indexed linked from 2018 and cut from £1.25m to £1m.
• Tax Avoidance
The goal is to raise £3.1bn over the next 5 years and diverted tax profits are to be introduced into legislation.
To abolish annual tax returns and national insurance contribution for those who are self-employed.
• Personal Tax
Personal tax allowance is to be raised by £10 800. The following year it is to be raised to £11 000.
A personal allowance of £1000 and a personal allowance of £500 for higher rate tax payers.