Key points of Budget 2015: At-a-glance
- 18 March 2015
- From the section UK Politics
George Osborne has delivered his sixth Budget as chancellor, and the last of the current Parliament. Here is a summary of the key announcements in his statement.
The state of the economy
UK grew 2.6% in 2014, faster than any other advanced economy but lower than 3% predicted in December
2.5% growth forecast in 2015, up from 2.4% predicted in December, followed by 2.3%, 2.3%, 2.3% and 2.4% in the next four years
Record employment in the UK, with jobless rate to fall to 5.3% this year
Trade deficit figures "the best for 15 years"
Living standards "higher" than in May 2010, according to OBR data, with households better off by an average of £900 in last five years
Inflation projected to fall to 0.2% in 2015
Deficit halved since 2010 as a share of national income
Borrowing set to fall from £97.5bn in 2013-14 to £90.2bn in 2014-15, £75.3bn in 2015-6, £39.4bn in 2016-7, £12.8bn in 2017-8 before reaching a £5.2bn surplus in 2018-9
Debt as a share of GDP to fall from 80.4% in 2014 to 80.2% in 2015-16 before falling in every year, reaching 71.6% in 2019-20
Additional £30bn savings needed in next Parliament
Public spending squeeze to end a year earlier than planned in 2019-2020, with spending from then to grow in line with total economic growth
Welfare bills set to be an average of £3bn lower each year than predicted in December, and interest charges on government gilts £35bn lower
Sale of £13bn Northern Rock and Bradford & Bingley mortgage assets
The lifetime allowance for pension savings that can be accumulated free of tax will be cut from £1.25m to £1m from April 2016, saving £600m annually
Pensioners will be able to trade in their annuities for cash pots, with the 55% tax charge abolished and tax applied at the marginal rate
Widows of police officers and firefighters who choose to marry again will have their existing pensions protected
Alcohol, tobacco and gambling and fuel
No changes to tobacco and gambling taxes, with tobacco duties set to rise by 2% above inflation, equivalent to 16p on a packet of 20 cigarettes.
New "horse racing betting right" to replace the 50-year old horserace betting levy on British bookmakers
Petrol duty frozen - September's planned increase cancelled
The tax-free personal allowance to rise from £10,600 in 2015-6 to £10,800 in 2016-7 and £11,000 in 2017-8
The threshold at which people start paying 40p income tax to rise by above inflation from £42,385 in 2014-5 to £43,300 in 2017-8
Annual paper tax returns to be abolished, replaced by digital accounts.
Transferable tax allowance for married couples to rise to £1,100
Class two national insurance contributions for self-employed to be abolished in next Parliament
Review of inheritance tax avoidance through "deeds of variation"
New personal savings allowance - first £1,000 interest on savings income to be tax-free for basic rate taxpayers and £500 allowance for 40p tax ratepayers.
Annual savings limit for ISAs increased to £15,240
"Fully flexible" ISA will allow savers to withdraw money and put it back later in the year without losing any of their tax-free allowance
New "Help to Buy" ISA for first-time buyers will allow government to top up by £50 every £200 saved for a deposit
A further £75m from Libor fines to go to charities for regiments which fought in Afghanistan and government to contribute towards permanent memorial to those who died in Afghanistan and Iraq and help renovate Battle of Britain memorials
£25m to support army veterans, including nuclear test veterans
Tax on "diverted profits" to come into effect next month, aimed at multinational firms moving profits "artificially offshore"
Annual bank levy to rise to 0.21%, raising an extra £900m. Banks to be barred from deducting compensation for mis-selling from corporation tax
Supplementary charge on North Sea oil producers to be cut from 30% to 20% while petroleum revenue tax to fall from 50% to 35%. New tax allowance to encourage investment in North Sea
Review of business rates
Automatic gift aid limit for charities to be extended to £8,000
Farmers allowed to average incomes for tax purposes over five years
New tax credit for orchestras and consultation on tax relief for local newspapers
Health and education
Consultation on proposal to offer loans of up to £25,000 for UK students studying for PhDs and research-based master's degrees.
Mental health services to get £1.25bn in extra funding
£15m church repair roof fund to be trebled
Up to £600m to clear new spectrum bands for auction to improve mobile networks: commitment to deliver ultra-fast broadband to all homes
New powers for Mayor of London over skills and planning
New inter-city rail franchise for south west of England