SUMMARY (Part 2)
- Fuel duty will be phased in over 10 months starting at 1% in April 2010, a further 1% in October 2010 and the remainder in January 2011. Unfortunately this is effectively a 3% rise in fuel duty however at least with it being spread over such a period it will give not only individuals in general but businesses especially time to budget and reassess their costings and selling prices.
- Alcohol Duty to rise by 2% and 10% on cider (subject to the strength of it!) duty at midnight on Sunday! It is clear that rises have to come in due to the huge British Economic deficit however my personal opinion is that is going to hit not only the individuals buying the drink but the British pub and restaurant industry which is probably already in its worst financial position ever. I can’t help feeling they should have applied this to beer & spirits sold to supermarkets etc and left the direct pub and hotel industry with a 12 month break to encourage spending in their industry!
- A welcome allowance for zero stamp duty for purchases of properties less than £250k (previously £125k) (being funded by a stamp duty charge of 5% on properties costing in excess of £1 million). This as stated unfortunately only applies to first time buyers which is a shame and should have been spread across the board on all house purchases under £250k. That said it is a further boost to the housing industry which I guess in turn will assist other areas of the economy such as the building and construction industry.
- A duty on Broadband of 50p per home…a disguised tax I would call that and I fail to see how relevant this is…while only small when added up helps reduce the deficit somewhat I guess!
A number of measures for individuals were also brought up by the Chancellor and are summarised as follows…
- Access to banking system for an extra 1 million people. This again is a welcome relief as how people can operate in today’s society without a bank account is beyond me! It is I suppose a necessary evil perhaps to have a bank account but the positives that come with it (access to funding, credit improvements, loans, reduction for paying bills by direct debit etc) make having a bank account worthwhile.
- Additional Tax Credits for those over 60 years old by reducing the qualifying number of hours worked is a welcome relief.
- Young workers retraining scheme to be extended to March 2012 for those under 24 years old – a welcome relief for both individuals and the business sector.
- 6 months extension to the scheme helping those people struggling with their mortgages…this was initially introduced to prevent repossessions but if you believe the facts it has only helped 15 individuals across the UK since it began….we will await to see how successfully this becomes!
- Tax free ISA limits to increase from £7,200 to £10,200 – again a welcome increase however with savings rates being at an all time low I wonder how many people will really benefit from this…clearly only those able to save circa £10k per year!
The above synopsis and comments made are on the first review of the Budget 2010 made by the Chancellor…...before acting on any of the above it is important that professional advice is sort especially with regard to the timing of actions and the detail behind any such actions. Eagle Accountancy, it’s principal nor any of its staff will take no responsibility for any actions taken on the above synopsis or comments.