Main points of Britain's emergency budget

22nd June 2010, Comments 0 comments

Here are the main points from Britain's emergency budget, presented by new finance minister George Osborne to the House of Commons Tuesday:

- Structural deficit set to be eliminated within five years

- Seventy-seven percent of this change will come through spending cuts and 23 percent through tax increases

- Welfare cuts worth 11 billion pounds (13 billion euros, 16 billion dollars) by 2014-15, including child benefit frozen for three years, caps on housing benefits and a tougher assessment for disability allowance

- two-year pay freeze for public sector workers

- Government accelerating moves to raise the state pension age to 66

- Most government departments face cuts of around 25 percent over four years, an overall figure of 17 billion pounds by 2014-15

- Payments to Queen Elizabeth II for carrying out royal duties frozen this year and subsequently facing a shake-up

- Value-added tax (VAT), a form of sales tax, to rise from 17.5 percent to 20 percent from January 2011

- Corporation tax to be cut next year to 27 percent and then by one percent annually for the next three years, giving Britain what Osborne said was "the lowest rate of any major economy"

- Capital gains tax for higher earners to increase from 18 percent to 28 percent

- Growth forecast lowered from 2.6 percent to 2.3 percent next year and set to rise back to 2.7 percent in 2014 and 2015

- In a joint move with France and Germany, government introducing bank levy covering British banks and the British operations of foreign banks, which is expected to raise two billion pounds annually

- Unemployment expected to peak this year at 8.1 percent and then fall each year to reach 6.1 percent in 2015

© 2010 AFP

0 Comments To This Article