Budget 2013: How will your family be affected?
- Credit: PA
AT lunchtime today Chancellor George Osborne will reveal the ins and outs of this year’s budget, and how he plans to help “those who want to work hard and get on”.
He has promised “a budget that tackles the economy’s problems head-on” - a message he conveyed this morning via social networking platform Twitter.
The nation is waiting on tenterhooks to hear Mr Osborne’s plans to help us as a nation out of the grim economic situation.
Hard-pressed families are struggling against a sea of ever-rising food prices and soaring petrol costs while their wages are failing to keep pace with inflation.
But Mr Osborne is expected to offer them a helping hand, speeding up progress towards a £10,000 tax-free personal allowance, delaying or even scrapping a fuel duty hike scheduled for the autumn and abolishing the so-called beer tax escalator.
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Nick Edgley, manager of personal tax at Ensors Chartered Accountants, said today: “The government’s aim is a £10,000 personal allowance in this parliament and, with the next general election due to take place within two years, an increase to £10,000 will surely be announced.
“Usually the chancellor combines this with a squeeze to the higher rate threshold, effectively bringing more tax payers into the 40% tax band. It would be good to hear, for once, this will not be done so everyone can enjoy the increase.”
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He continued: “Fuel duty is another drain on the family’s income. An adjustable fuel duty was considered a few years ago to keep the price the same to the public even if the cost of a barrel went up. A revisit of this, or a cut in duty, would be a popular announcement today.”
He believes that a cut in council tax is unlikely but added: “Another freeze is possible and would be welcome.”
Mr Edgley would like to some area of the tax system simplified as a result of today’s budget.
“Some aspects of the tax system are complex. Rules have been looked at for simplification, but then we get a new one that is complex; the new Child Benefit Tax Charge is one example. More advance consultations so these rules can work in practice would be welcome.”
With each of these changes, there will be winners and losers and what is given on one hand, is often taken away in the other.
So will you have more spare cash as a result of today’s announcements?
“I do not expect any drastic cuts, just the usual tinkering and, if we are lucky, some future cuts announced,” said Mr Edgley. “With a big hole to fill in the country’s finances, an NIC (national insurance contributions) increase could be on the cards, which is usually a ‘stealthy’ way to increase money going into the Treasury.
“However given the uproar last March on the “pasty tax” and “granny tax”, and the U-turns made, surely the chancellor will not make the same mistake again.”