Todays budget at a glance
Welfare and pensions
- Working age benefits to ne frozen for four years, including tax credits and local housing allowance
- Rents in social housing sector will be reduced by 1% a year for the next four years
- Higher-income households in social housing will be required to pay rents at the market rate
- Tax credits and Universal Credit to be restricted to two children, affecting those born after April 2017
- Reduce earnings level for tax credits withdrawal from £6,420 to £3,850.
- Disability benefits will not be taxed or means-tested
- 18-21-year-olds will not be entitled to claim housing benefit automatically, with a new “earn to learn” obligation
- Employment and Support Allowance payments for claimants deemed able to work to be “aligned” with Jobseeker’s Allowance for new claimants
- pensions tax allowance to be tapered away to a minimum of £10,000 from next year
- Dividend tax credit to be replaced with a tax free allowance of £5,000 of dividend income for all taxpayers. The rates of dividend tax will be set at 7.5%, 32.5% and 38.1%
Fuel
- New VED bands for new cars to be introduced from 2017, pegged to emissions – 95% of car owners will pay £140 a year.
- Fuel duties frozen for the remainder of this year
Personal Taxation
- Personal tax allowance to rise to £11,000 next year
- The point at which people start paying income tax at 40p to rise from £42,385 to £43,000 next year
- National living wage to be £9 per hour by 2020 for people 25 and over, starting from £7.20 per hour from next April
- Increase in inheritance tax threshold to £1m for married couples by 2017
Business
- Corporation tax cut to 19% in 2017 and 18% by 2020
- New apprenticeship levy on all large firms- firms that offer apprenticeships can get more back than they put in
Health and education
- NHS will receive a further £8bn by 2020 (in addition to the £2bn already announced)
- Maintenance grants for students paid to students with family income below £42,000 to be scrapped and converted into loans from 2016/17, repayable on incomes over £21,000
- The maintenance loan will increase to £8,200
Housing
- Mortgage interest relief for buy-to-let homebuyers to be restricted to basic rate of income tax
- Rent-a-room relief scheme to rise to £7,500
Other
- The cost of funding free TV licences for the over-75s will be transferred from the government to the BBC between 2018 and 2021
- The annual household benefit cap will be reduced to £23,000 in London and to a lower level in the rest of Britain.
- A consultation will take place on changing Sunday trading laws
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