Thursday, 10 December 2009

Pre-Budget Report 2009 Summary

A summary of the key announcements in Alistair Darling's pre-Budget report.

TAX



  • All national insurance rates to rise by a further 0.5% from April 2011, raising £3bn a year

  • VAT to return to 17.5% from 15% from 1 January 2010. No other changes to VAT

  • One-off 50% tax on bank bonuses of more than £25,000

  • Stamp duty holiday on certain properties to end on 1 January 2010

  • Bingo duty to be cut from 22% to 20%

ECONOMIC FORECASTS



  • Economy forecast to shrink 4.75% in 2009, worse than 3.5% forecast in April

  • Growth of 1%-1.5% expected in 2010 and 3.5% in 2011 and 2012

BORROWING



  • 2009 forecast raised by £3bn to £178bn

  • Estimated borrowing of £176bn in 2010 and £140bn in 2011, falling to £96bn in 2013

  • Budget deficit to be halved by 2013

  • Estimated public loss from bank bailouts reduced from £50bn to £10bn

SPENDING



  • Total spending in 2010-11 to rise by £31bn.

  • No spending review for period after that

  • Current spending estimated to fall by 0.8% between 2011-2 and 2014-5

PAY, PENSIONS AND BENEFITS



  • Basic state pension will rise by 2.5% in April 2010

  • Child and disability benefit to rise by 1.5% in 2010

  • Contributions to public sector pensions to be cut by £1bn a year

  • All public sector pay settlements to be capped at 1% for two years from 2011

ENVIRONMENT



  • £160m investment in low-carbon and renewable projects

  • £200m extra investment for Warm Front insulation scheme, helping 65,000 households

  • Boiler scrappage scheme for 125,000 households

  • Electric cars to be exempt from company car tax for five years

  • Tax rebate for installation of wind turbines and solar panels

EMPLOYMENT



  • Under-24s to be guaranteed work or training after six months out of work

  • Training or education guarantee for 16 and 17-year-old to be extended to 2010

BUSINESS



  • New 50p tax on landline phones to pay for superfast broadband

  • New 10% tax on income from patents to boost science development

  • 1p increase in corporation tax for small firms to be deferred

FAMILIES



  • Free school meals to an extra 500,000 low income families

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