Budget 09: The highlights
Our at-a-glance guide to the key points of the Budget
Economy
The economy to shrink 3.5% in 2009, but grow by 1.25% in 2010
Growth expected to pick up in 2010, expanding by 1.25%.
Borrowing to rise to £175bn in 2009, followed by further rises of £173bn,
£140bn £118bn and £97bn the following years
CPI inflation to drop to 1% by the end of the year
Personal taxation
A new income tax rate of 50 per cent will apply to people earning over
£150,000
The income tax personal allowance will be reduced to those with incomes over
£100,000
Alcohol, Tobacco and Fuel
Alcohol taxes go up 2% at midnight – or 1p a pint
Tax on tobacco up by 2% from 6pm – or 7p on a pack of 20 cigarettes
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Fuel duty to rise by 2p per litre from September, followed by 1p a litre over
inflation each April for four years
Public savings
£1bn raised from the closure of identified tax avoidance loopholes over the
next three years.
Further £9bn generated in efficiency savings
Public spending cut from 1.1% in 2010 to 0.7% in 2011-12
Business aid
Loss-making companies will be able to reclaim more taxes paid in the last
three years until November 2010
£750m strategic investment fund to help emerging technologies and regionally
important sectors
Main business capital allowance rate doubled to 40%
Pensions and savings
Basic state pension will increase by at least 2.5%
A rise of £100 to over-80s households and £50 to over-60s households in
2009/10, via the Winter Fuel Payment
Tax relief on pensions contributions will be restricted for those earning
£150,000 and over
The annual investment limit for ISAs rises to £10,200 of which £5,100 can be
saved in cash. These higher limits will be available to over-50s from 6 October
2009 and to everyone from 6 April 2010.
Housing and homeowners
The Stamp Duty land tax threshold on residential properties costing £175,000
or less will be extended until 31 December 2009.
Another £80m for the shared equity mortgage scheme
£500m for stalled housing projects
Motoring and transport
A temporary car scrappage scheme – it offers consumers £2,000 off the cost of
a new vehicle to replace a vehicle more than 10 years old.
Employment and training
18-24 year olds who have been unemployed for 12 months will be guaranteed a
job, training or a work placement.
An extra 54,500 places will be created in the next academic year for 16 and
17 year olds who wish to take them up.
The environment
Over £1.4 billion of support will be targeted at in the low-carbon sector.
£435m being made available for energy efficient schemes for homes, businesses
and public buildings
£405m being made available to encourage low-carbon energy and advanced green
manufacturing