CHANCELLOR Rishi Sunak had a tough job on his hands with yesterday’s Budget.
He needed to make efforts to start repairing the damage done by the pandemic — but at the same time he needed to make sure Brits would not be too badly hit in the short-term given that the crisis is still ongoing.
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The Sun has examined Mr Sunak’s policies to see how they affect you. So have they left your glass half full — or will you be turning it upside down to tip out the last dregs?
INCOME TAX: Income tax rates are not going up but band levels are being frozen. That means over two million people will either see their tax bill go up or start paying it for the first time. This “stealth tax” will raise £20billion over five years.
CORPORATION TAX: Big business will have to foot the bill for the pandemic with a hike in their corporation tax to 25 per cent from 2023. It is set to raise billions to bolster the economy by 2026. But the rate will still be lower than other G7 nations.
SELF EMPLOYED: An estimated 600,000 people are eligible to apply for two more batches of pandemic cash. Anyone who filled in a tax return before the Budget will be eligible for up to £7,500 for every financial quarter, at a total cost of £12billion.
BOOZE AND PUBS: Booze duty was frozen for the second year running, while the VAT cut for hospitality venues will stay at five per cent until September.
Pubs, restaurants and shops will also be handed grants worth up to £18,000 to reopen.
FURLOUGH: The scheme will continue until September. The Government will pay wages up to £2,500-a-month until the end of June. Firms will then be expected to contribute an extra 10% in July, rising to 20% in August and September.
NHS: There was nothing for our NHS heroes. The Chancellor mentioned the Health Service only once and did not refer to social care.
HOUSING: A new mortgage scheme will help people with small deposits. The Stamp Duty holiday was further extended. Nothing for builders.
HIGH STREET: The Chancellor will allocate £1billion to regenerate 45 town centres in England to help them recover from Covid’s impact.
MINIMUM WAGE: The minimum wage will still be increased to £8.91 from April. It will mean a pay rise for more than two million workers.
PENSIONS: Pensions lifetime, inheritance tax and capital gains tax allowances frozen. It will hit pensioners, investors and the grieving.
BUSINESS: Firms will be able to claim back 130 per cent of investments in machinery, tools and IT equipment from their tax bill.
VACCINE: Another £1.6billion will deliver more jabs to Brits. It will fund more than 100 mass vaccine centres and pay 80,000 workers.
WORLD CUP: Rishi Sunak guaranteed £2.8million to bring football home and help Britain and Ireland’s joint bid for the 2030 World Cup.
GREEN: The first sovereign green bond could raise £15billion to beat climate change. Critics say not enough was done to help save the planet.
LEVELLING UP: Eight free ports will be allocated in England, with many in Red Wall seats. Treasury offices will move to Darlington in Co Durham.
UNIVERSAL CREDIT: The £20 uplift will stay in place for another six months. It is worth £1,000 a year to those on Universal Credit.
FUEL DUTY: Fuel duty has been frozen again for a record 11th year. It came after The Sun led a decade-long Keep It Down campaign.
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The Sun says
RISHI Sunak has bet the farm on fuelling a historic two-year boom to bail out our broken economy.
Provided inflation stays low, it’s the right course. Even the Office for Budget Responsibility, not famous for its exuberant optimism, reckons we are poised to roar back — with FAR lower unemployment than first feared too.
The Chancellor’s Budget contained a blizzard of welcome tax breaks designed to transform post-Brexit, post-Covid Britain into a super-strength magnet for investment and jobs.
And despite the almost unimaginable hole the pandemic has blown in the public finances, there were still nuggets for Sun readers to cheer.
Mr Sunak froze duty on booze and, once again, on fuel –— another triumph for The Sun’s decade-long campaign.
We were spared rises in income tax, National Insurance and VAT rates.
The living wage goes up. The Universal Credit increase is maintained for longer. Those still furloughed have a few more months’ security. Likewise any self-employed still unable to work.
Billions were splashed out in grants or tax breaks to shore up and revive crippled firms.
There will be delight in the former Red Wall seats at the £1billion fund for regenerating towns — and in the eight sites for new, job-creating free ports.
Some young house-hunters will rejoice at new Government-backed 95 per cent mortgages, though we do fear prices will soar ever higher without a vast increase in the supply of properties.
But there was bleak news too.
Our overall tax burden is ultimately poised to rise to its highest in decades.
The freeze on tax thresholds from 2023 will hit millions. Mr Sunak justifiably claims no one will take home less than they do now, but the billions raised still come from workers’ increasing wages.
The sharp hike in corporation tax The Sun has warned against is coming too, but was wisely also postponed for two years and limited to the biggest firms.
We hope Mr Sunak will in time revise it downwards. There is surely a risk, if investment is still pouring in, of slamming a brake on it.
Official forecasts show depressingly flat growth beyond 2022 — but they may be pessimistic. No one can know how well the Chancellor’s plan will work.
What is certain is that Keir Starmer’s, such as it is, would not. His priority, a pay rise for NHS workers, is a strange way to tackle a gargantuan debt whether you agree with it or not.
The floundering Labour leader even resorted to resurrecting his failed “circuit-breaker lockdown” brainwave which Wales tested to destruction.
Yes, it is tough to respond to a Budget. Even so, Starmer’s vacuous riposte was one Jeremy Corbyn might have delivered.
It really was that bad.
Corporation tax to rise to 25% Rishi Sunak reveals Budget 2021 sting for big businesses
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