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Speech in full | Reaction | Eco-worrier on plastic bags | Podcast: winners and losers | Video: Anatole Kaletsky | Economic perspective | Video sketch | Graphic: the main changes
Lifestyle taxes
- Duty on a bottle of spirit to increase by 55p – the first increase in more than 10 years and the biggest rise since 1991.
- The price of a bottle of wine will rise by 14p, a pint of beer will cost 4p more and a litre of cider will rise by 3p.
- A packet of 20 cigarettes will now be 11p more expensive from 6pm today. A packet of five cigars will rise by 4p.
- By introducing an escalator for alcohol duty similar to the one that controversially used to apply to road fuel, the Chancellor plans to bring in £1.5 billion over the next three years in extra tax on beer, wine and spirits.
- Tax on donations to charities will fall from 22 per cent to 20 per cent from April.
Environment
- Charges on plastic bags may be introduced next year if shops fail to reduce their use on a voluntary basis.
- Fuel duty will rise by 0.5p per litre in 2010. A 2p increase in fuel duty is deferred until October this year.
- First year car tax on so-called "gas guzzler" vehicles will rise by £1,000.
- Carbon emissions from vehicles to be reduced from 130 grammes to 100 grammes per kilometre by 2020
- Road pricing could reduce congestion and help environmental measures. The Government will invite tenders to develop road pricing technology.
- Revenue from plane duty to rise by 10 per cent.
- New measures at Heathrow and other airports to increase the use of biometric technology to speed up air travel.
- Climate change levy to rise in line with inflation.
- A total £26 million will be committed to the Green Home Service to help families cut fuel bills. UK carbon emissions to be reduced by 80 per cent by 2050.
- The first carbon Budget will be announced alongside the Budget next year.
- Energy companies to spend £150 million a year on energy tariffs.
- Five million customers on pre-payment meters to be given a fairer deal. Legislation will be introduced if necessary.
Property
- £8 billion in funds to be committed to new, affordable and social housing.
- Stamp duty on shared ownership homes will not be required until the occupant owns 80 per cent of the equity.
- Teachers, nurses and first-time buyers can borrow money for shared equity schemes, and the minimum stake has been reduced from 75 per cent to 50 per cent.
- The Government has found sites for 70,000 new homes this year.
- Labour is seeking views on how long-term fixed mortgages can help first-time buyers to get on the housing ladder.
- Council tax bills will rise by an average 3.9 per cent from April. (Already announced)
- All new offices, shops and other commercial buildings are expected to be zero carbon by 2019.
Family and Investment
- Government to invest an extra £125 million over three years to stop child poverty.
- From April 2009, child benefits will rise to £20 for the first child. An extra £50 above inflation will be added to child tax credit for low and middle-income families.
- The threshold for inheritance tax of 40 per cent will rise from estates valued at £300,000 to £312,000 with plans to increase the level to £350,000 by 2010-2011. (Already announced)
Savings
- Government to launch the Saving Gateway, a cash saving scheme for those on lower incomes, will be introduced nationally, with the first accounts available to savers in 2010.
- To encourage people to save money, the Government will increase the ISA investment limit to £7,200 from April with the amount that can be held in cash rising to £3,600.
Corporation tax and business
- Government to go ahead with plans to charge a levy, set at £30,000, for non-doms in the UK who will not be charged on offshore income.
- No further cut on corporation tax above the 2 per cent reduction to 28 per cent announced last year. (Already announced)
- Small business corporation tax rate to rise to 21 per cent in 2008-2009 and and 22 per cent in the following year.
- An extra £60 million has been committed to filling the UK “skills gap”.
- Aims for small businesses to win 30 per cent of public sector business
- Funds for loan guarantee scheme for small businesses will be increased by £60 million.
- Government will introduce a capital fund of £12.5m to encourage more women entrepreneurs.
- The threshold for businesses to account for VAT on a cash basis will increase from £660,000 to £1.35 million in April. (Already announced)
- A flat rate of 18 per cent will be charged for capital gains tax. (Already announced)
Pensions
- Fuel benefits for the over 60s rises from £200 to £250 and for the over 80s rises from £300 to £400
Public spending
- Public spending in next three years will grow by 2.2 per cent.
- The Government will spend £2 billion more on British troops in 2008 including £900 million on equipment.
- Schools to receive £200 million extra to raise GCSE results. A £30 million fund will be introduced to improve science studies.
- By April 2010, all long-term recipients of incapacity benefits will face work assessments.
Income tax and national insurance
- For people on lower rates on income tax, the 10 per cent rate on the first £2,230 of earnings will be abolished from April. (Already announced)
- The basic tax rate will be applied to earnings between £2,231 to £34,600, with the rate falling from 22 per cent to 20 per cent in April. (Already announced)
- The upper earnings limit on national insurance contributions will be increased from £670 per week to £770 per week. (Already announced)
Economy
- UK growth forecast for 2008 has been reduced to between 1.75 per cent and 2.25 per cent, compared to previous forecasts of between 2 per cent and 2.5 per cent.
- Growth forecasts for 2009 are now set at 2 per cent to 2.5 per cent, a reduction on 2.5 per cent to 3 per cent expectations. For 2010, growth is forecast at 2.5 per cent to 3 per cent.
- GDP will rise to between to 2.25 per cent and 2.75 per cent in 2008. In 2009, GDP will rise to between to 2.25 per cent and 2.75 per cent and in 2010 to between 2.25 per cent and 2.75 per cent.
- The inflation target for CPI will remain at 2 per cent.
- Borrowing will rise from £36 billion to £43 billion in 2008, equal to 2.9 per cent of national income. This will decline £23 billion, or 1.3 per cent, by 2012-2013.
- Borrowing will total £140 billion over the next four years.
- The current Budget deficit will be £10 billion in deficit in 2008-2009. It is forecast to decline to £4 billion in the following year and is expected to return to a surplus in 2010-2011 - a year later than was scheduled.
- UK debt is now 36.6 per cent of GDP. Debt is forecast to reach 38.5 per cent in 2008.
- Public sector investment will reach £33 billion next year.
Howard Archer, chief UK and European economist at Global Insight, said: "As expected, the Chancellor played up the economy's performance over the past decade under the Labour government and attributed much of the UK slowdown in 2008 to a deteriorating global environment.
"However, this skates over the fact that the UK economy has serious problems of its own,notably including high household debt levels and an over-extended housing market, while the public finances are in poor shape despite the economy experiencing extended robust growth during Labour's time in power.
"This seriously limited Mr Darling's scope for fiscal manoeuvre in this Budget."
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