Chancellor's Budget is announced
The Chancellor George Osborne has announced his Budget.
Mr Osborne has announced that the 50p top rate of income tax will be cut to 45p from April 2013.
He said the rate, paid on earnings over £150,000, damaged competitiveness and raised a third of the £3bn expected.
The tax free personal allowance will be raised to £9,205. Mr Osborne believes this will give low and middle earners an extra £220 a year.
Child benefit will also now be removed gradually for those earning more than £50,000.
Mr Osborne had planned to axe it where one parent earned over £43,000, but he has decided that it will be phased out when someone in a household has an income of more than £50,000.
It will fall by 1% for every £100 earned over £50,000.
Only those earning more than £60,000 will lose the benefit entirely.
First impressions of George Osborne's 2012 Budget are of one that has a lot of good stuff in it for Northern Ireland - with more detail needed on the potential pitfalls.
The reduction next year in the 50p tax rate to 45p for the highest earners (those over £150,000) may have grabbed the headlines in recent days. But it will only affect 4,000 people in Northern Ireland.
Likewise the hike in stamp duty paid on sales of luxury homes over £2m to 7% will hurt few people here. A trawl of two popular websites suggests just two houses on the market in Northern Ireland that will be affected.
However the increase in the personal allowance - which is the point beyond which you start paying tax - will benefit hundreds of thousands here. From next April the allowance rises to £9,205 - that will take thousands out of the tax system altogether, and benefit a further 650,000 plus to the tune of £220 a year.
The chancellor announced a cut in corporation tax for big business to 24%, falling to 22% by 2014. This will have limited impact in Northern Ireland where more than 99% of businesses are small. Their tax rate remains unchanged at 20%.
However he announced proposals for the smallest businesses that will allow them to move to a cash-based tax calculation. This simplification of the process should help many of the 126,000 small businesses here.
Smokers are hit with a 37p hike in the price of a packet of cigarettes from midnight. Drinkers are spared any large increases, but alcohol duty is not frozen, which will put 3p on a pint of beer, 11p on a bottle of wine and 41p on a bottle of spirits. And motorists still face the 3p extra on a litre of petrol or diesel from this August.
More detail is needed on the chancellor's statement that "some departments" may move to local pay. It appears to be a limited move at this stage. But if the principle of regional pay in the public sector is established it will have far-reaching consequences for Northern Ireland's 220,000 state employees and those that rely on their pay packets.
The reference to an enterprize zone for Northern Ireland appears to be only a reference at this stage. It is up to the Northern Ireland Executive to move on that, and it has so far shown little enthusiasm for the idea, preferring instead to focus all its efforts on securing the ability to lower corporation tax in this region.