The Budget 2014 - 12:30

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It’s that time of year again. Not a lot being leaked this time around so we’ll have to wait and see what the Chancellor says.

Coverage:

http://www.bbc.co.uk/news/business-26517496

BBC Two, the BBC News Channel and on Radio 5 live


What to expect in the Budget:

Personal Allowance

The Lib Dems have made it known that they are pushing for the personal tax allowance to be raised from £10,000 to £10,500. But sources admit they are "pushing at an open door".
This idea, first proposed on the front page of the Lib Dem 2010 manifesto, has been accepted with glee by tax-cutting Tories who want to claim credit for its implementation.

Higher rate of tax

The Chancellor has been under pressure to take some of 4.4m people out of the higher rate, 40p, tax bracket. All the indications have been that he won’t do it. When asked about it this weekend he insisted that the personal allowance changes had helped the middle classes as well as workers lower down the income scale.

Childcare

Mr Osborne announced a series of plans to help parents pay for childcare last year – but in this Budget he is being more generous.
Parents will be able to have 20% of their childcare costs covered up to a maximum of £2,000 a year. There is a u-turn on Universal Credit with the Chancellor bowing to pressure from charities to raise the proportion of childcare covered for recipients from 70 to 85%. And a new pupil premium for nurseries in England.

Housing

Another area that has been trailed is plans to help fund the infrastructure to support a new garden city in Ebbsfleet Kent, with its high-speed link to London.
The Chancellor is also extending the first (less controversial) phase of help-to-buy for first time buyers purchasing new-build homes. These policies are designed to drive up supply of housing to help meet a 2016 target of 240,000 new homes a year.

Freeze in the carbon tax

The aim here is to help ease pressure on energy bills. The plan is to freeze the carbon price floor, which provides a disincentive to burning fossil fuels by pushing up the costs.

Exporters

Mr Osborne insisted in a speech in Hong Kong that he wanted this Budget to have a "made in Britain" theme – helping companies producing British goods to sell abroad. The Budget is likely to include resources made available particularly for small and medium sized business in a bid to try to meet a target to grow exports by £1tn by the end of the decade.

Investors

This is another area in which the Chancellor is under pressure to make progress. Investors in infrastructure such as road are keen to see allowances for capital spending increase. They are already extremely generous. One hope is that Mr Osborne will extend or increase a £250,000 annual investment allowance due to end at the start of next year.
 
This is what I imagine they'll be doing today.

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please scrap stamp duty full stop... (not going to happen though :() - stamp duty isn't really the problem anyhows, lack of housing is the biggest issue!

They could start by not red taping access to empty and unused properties. I called my local council recently trying to find info on empty homes that I could buy and renovate, and was told that I couldn't have the information. I'd have to find a house I thought was empty, call up, get info and proceed. SIgh.
 
The concept of stamp duty is much less irritating than the implementation.

Going from £249,950 up to £250,050 on a house purchase picks up an extra £5k of tax. Reference. That deforms the housing market to no obvious gain - all the house prices bunch up just under the threshold.

It would be trivial to provide a linear scale which worked out at the same overall tax income without distorting the market (think income tax), yet this discontinuous approach is what we're sticking with. Irritating.
 
The concept of stamp duty is much less irritating than the implementation.

Going from £249,950 up to £250,050 on a house purchase picks up an extra £5k of tax. Reference. That deforms the housing market to no obvious gain - all the house prices bunch up just under the threshold.

It would be trivial to provide a linear scale which worked out at the same overall tax income without distorting the market (think income tax), yet this discontinuous approach is what we're sticking with. Irritating.

Income tax isn't exactly a linear scale either. ;) But for what it's worth, I agree with the principal.
 
Either a significant hike in the Personal Allowance or the reintroduction of the 10p Income Tax rate should be done imho.

Oh and I should imagine the Lifetime Allowance will be brought closer to £1,000,000 which is utterly ****ing ludicrous and will bite us hard in the ass in years to come.
 
I'm expecting a pre-election bribe given that 2015 is a general election year so next year's budget won't have much influence on people's perception.

I think top of any list has to be getting rid of VAT on essentialls - especially fuel. VAT is a horrendously regressive tax which affects the most vulnerable in society the most. I don't think the Chancellor will do this as he likes regressive taxes which affect the richest the least.
 
Either a significant hike in the Personal Allowance or the reintroduction of the 10p Income Tax rate should be done imho.

So just lowering taxes across the board when we are trying to reduce the deficit?

Oh and I should imagine the Lifetime Allowance will be brought closer to £1,000,000 which is utterly ****ing ludicrous and will bite us hard in the ass in years to come.

Care to qualify that?
 
I'm expecting a pre-election bribe given that 2015 is a general election year so next year's budget won't have much influence on people's perception.

I think top of any list has to be getting rid of VAT on essentialls - especially fuel. VAT is a horrendously regressive tax which affects the most vulnerable in society the most. I don't think the Chancellor will do this as he likes regressive taxes which affect the richest the least.

Eh?

Surely most of a poor families income is spent VAT free or reduced VAT? Food, baby/kids stuff, hello magazine - a poor family won't be running a car, or will be putting very few miles into it anyway. Even energy is reduced VAT.

Compare that to all the VAT-able luxaries a middle income+ familly will buy, and VAT looks to me to be progressive.
 
Most of it has already been announced:

http://www.bbc.com/news/business-26529697

I would love it if they merged National Insurance and Income Tax, set the Personal Allowance at £12k and then had a 32% tax rate to £60k followed by a 42% tax rate onwards. Removes a huge amount of low paid people from the tax net while giving the middle class a bit of a boost and removing complexity at the top. Nice and simple.
 
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