"Why have a Budget?" Tim Knox writes guest column (Reuters)

Tim Knox, CPS Director, guest writes for Reuters on yesterdays Budget.

Next year, the British government will spend £680 billion – or just under £2 billion a day, every day of the year. Remember that when considering all the noise – in both Parliament and the media – about yesterday’s Budget.

Take the five main areas of tax reform put forward yesterday:

  • The reduction in the top rate of income tax from 50p to 45p. Cost to Treasury:  £50 million
  • The increase in the personal allowance to £9,205 in 2013. Cost to Treasury: £3.32 billion
  • The freezing of the personal allowance for pensioners. Tax raised: £360 million
  • The further cut in Corporation Tax to 24p. Cost to Treasury: £730 million
  • The increase in Stamp Duty on properties over £2 million to 7%. Tax raised £180 million

(Figures are for 2013/14. Source: Red Book. Table 2.1)

So these main tax changes account for £4.5 billion – the equivalent of a couple of days spending.”

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Date Added: Thursday 22nd March 2012