Government set to raise NI after announcement in pre-Budget report
News Article - 10 December 2009
Category:
Regulatory
Alistair Darling has claimed the main tenets of his recent pre-Budget report – the final one prior to next year’s general election – were chosen to promote growth without ‘wrecking’ economic recovery. Commentary from senior industry figures has been mixed; some critics have suggested that whilst the report does not worsen the current economic climate, much of it is based on perceived short-term thinking.
The most talked-about point has been an increase in National Insurance, from 2011, of 0.5% more than previously planned. In addition to the NI increase, the main points of the pre-Budget report include:
- One-off 50% tax on bank bonuses over £25,000.
- VAT to return to 17.5% on January 1st 2010. No other VAT reforms.
- Estimated borrowing levels of £176bn in 2010, falling to £140bn in 2011, and £96bn in 2013.
- Electric cars exempt for 5 years from company car tax.
- A halving of the budget deficit by 2013.
- Expenditure to rise by £31bn in 2010-2011.
- Basic state pension rate will rise by 2.5% in April 2010.
- Cap on public sector pay rises of 1%.
- Free school dinners to an extra 500,000 low income families.
- £160m investment in renewable and low-carbon technologies.
- Tax rebates for installation of solar panels and wind turbines.
- Deferred 1p increase in small business corporation tax.
The controversial 50p ‘broadband tax’ was also included.
Access continues to monitor changes and develop its solutions to ensure they comply with the latest legislation, including the latest Dimensions upgrade, which is ready for when the VAT reverts in January. If you’d like more information, please call Kevin Misselbrook on 0835 345 3300.
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