Wednesday, 23 March 2011

A budget with 'alarm clock Britain' at its heart

Today's budget puts the needs of 'alarm clock Britain' first and foremost according to an email I received from Nick Clegg this afternoon. I'm not sure that flogging the dead horse of that particular phrase will do much good, but the budget itself contained some really good news (and some more wishful stuff).

The great news - the move towards raising the income tax threshold to £10,000 is still happening. This week, the tax threshold - the level at which people start to pay income tax - will rise to £7,475 taking 880,000 people out of the tax system altogether. Today's announcement was of a further £630 rise next year to £8105. This will give lower earners (not just those on less than £8k) an extra £126 per year.

Other good news was the recognition of the damage that high fuel bills are doing to rural areas. We'll see the abolition of the fuel duty escalator, a cut of 1p per litre from tonight, the postponement of the planned 4p rise in April and moves towards a price stabiliser. Of course, this only partially redresses the 3p per litre rise that came in in January when VAT went up, but all Labour had to offer was an illegal plan to introduce a differential rate of VAT.

We also heard that there will be a water bill relief fund for people in the South West where we pay the highest bills - just 3% of the population pay for cleaning up 30% of the coast.

Both the tax threshold rise and the water relief fund are clear Lib Dem wins and the fuel duty issue is one on which local Lib Dems have campaigned strongly.

A cut in business tax, the imposition of air duty for private jets and help for first time homebuyers are also good news but they all depend on the finer details and I suspect the jet tax is merely a sop to the left rather than anything that will really make a difference.

There are, of course, many things he could have said but didn't. This could have been the time to reverse the planned cut in the feed in tariff for green energy or to devolve more powers to local government, but neither came.

1 comment:

Liberal Neil said...

"This will give lower earners (not just those on less than £8k) an extra £126 per year."

It will give ALL income tax payers £126 per year.