LONDON, March 19 British finance minister George
Osborne presented his annual budget statement to parliament on
Following are highlights from his speech:
BUSINESS ENERGY BILLS
"We are going to have a 7 billion pounds package to cut
energy bills for British manufacturers - with benefits for
families and other businesses too."
"Next year there will be no income tax at all on the first
10,500 pounds of your salary.
"Ten and a half thousand pounds tax free. 800 pounds less in
tax every year for the typical taxpayer. Our increases in the
personal allowance will have lifted over 3 million of the lowest
paid out of income tax altogether."
"There is a 10 pence starting rate for income from savings.
It is complex to levy and it penalises low-income savers. Today
I am abolishing the 10 pence rate for savers altogether.
"And we will almost double this zero-pence band to cover
5,000 pounds of saving income. One and a half million low-
income savers of all ages will benefit.
"Two thirds of a million pensioners will be helped. "
"I am announcing today that we will legislate to remove all
remaining tax restrictions on how pensioners have access to
their pension pots.
"Pensioners will have complete freedom to draw down as much
or as little of their pension pot as they want, anytime they
want. No caps. No drawdown limits.
"Let me be clear. No one will have to buy an annuity."
TAX RELIEF ON ISAs
"We will make ISAs simpler by merging the cash and stocks
ISAs to create a single New ISA."
"We are going to make the new ISA more generous by
increasing the annual limit to £15,000."
"£15,000 of savings a year tax free - available from the
first of July."
RAISING TAX THRESHOLDS
"I can also confirm today that the higher rate threshold
will rise for the first time this Parliament, from 41,450 pounds
to 41,865 pounds next month, and then by a further 1 percent to
42,285 pounds next year.
"And because I am also passing the full benefit of today's
personal allowance increase on to higher rate taxpayers - people
earning 42,000, 43, 50, 60, all the way up to 100,000 pounds
will be paying less income tax because of this Budget."
WHISKY, BEER TAXES
"Scottish Whisky is a huge British success story. To support
that industry, instead of raising duties on whisky and other
spirits, I am today going to freeze them.
"And with some cider makers in the West Country hit hard by
the recent weather, I am going to help them by freezing the duty
on ordinary cider too.
"And then there's beer. I know the industry, led so ably by
my Honourable Friend for Burton, have been campaigning for a
freeze. But beer duty next week will not be frozen.
It will be cut again by 1 pence."
"Turning to gambling duties.
"Fixed odds betting terminals have proliferated since
gambling laws were liberalised almost a decade ago.
"These machines are highly lucrative, and therefore it's
right we now raise the duty on them to 25 percent. We will also
extend the horserace betting levy to bookmakers who are based
"And we'll look at wider levy reform and at introducing a
'racing right' to support the sport."
SUPPORTING BUSINESS INVESTMENT
"In 2012 I increased the Annual Investment Allowance
ten-fold to 250,000 pounds. This generous allowance was due to
expire at the end of this year - and all the business groups
have urged me to extend it.
"So we will. But we'll do more. We're going to double the
Investment Allowance to 500,000 pounds, extend it to the end of
2015, and start it next month."
HIGHER STAMP DUTY FOR CORPORATE HOMES ABOVE 500,000 POUNDS
"We will expand the tax on residential properties worth over
2 million pounds to those worth more than 500,000 pounds."
(Homes exceeding 500,000 pounds will now be subject to
higher 15 pct stamp duty IF they are bought by a company)
NORTH SEA OIL/SCOTTISH INDEPENDENCE
"We will introduce now a new allowance for ultra high
pressure, high temperature fields to support billions of pounds
of investment, thousands of jobs and a significant proportion of
our energy needs.
"Even with these measures, the North Sea is a mature basin -
and the OBR have today revised down the forecast tax receipts by
a further 3 billion pounds over the period.
"The Scottish economy is doing well and jobs are being
"But this is a reminder of how precarious the budget of an
independent Scotland would be. These further downgrades in the
tax receipts would leave independent Scots with a shortfall of
1,000 pounds per person.
"Britain is better together."
LOWER AIR TAX ON LONG-HAUL FLIGHTS
"From next year, all long-haul flights will carry the same,
lower, band B tax rate that you now pay to fly to the United
DOUBLING LENDING TO EXPORTERS
"Our exports have grown each year and the OBR today forecast
rising export growth in the future. But we're starting from a
low base and we've got many lost years to catch up.
"For decades the British government has been the last port
of call, when we should be backing British businesses wanting to
"Today we fundamentally change that. And we're going to
start with the finance we provide our exporters. We will double
the amount of lending available to 3 billion pounds."
CLAMPING DOWN ON TAX AVOIDANCE
"While the vast majority of wealthy people pay their taxes,
there is still a small minority who do not. We will now require
those who have signed up to disclosed tax avoidance schemes to
pay their taxes, like everyone else, up front."
"While for now the OBR do not expect the situation in
Ukraine to have a large impact on us, they do warn that an
escalation risks higher commodity prices, higher inflation and
SPENDING CUTS IN NEXT PARLIAMENT
"We must bring our national debt substantially down."
"Analysis published today shows just running a balanced current
budget does not secure that. Instead, Britain needs to run an
absolute surplus in good years.
"So I can confirm that in addition to the cuts this year and
next, there will be cuts in the next Parliament too.
"To lock in our country's commitment to this path of deficit
reduction we will seek the support of Parliament in a vote. And
I will bring forward a new Charter for Budget Responsibility
"We are entering a critical phase and we must learn from the
past. Every time a post-war government has embarked on public
spending cuts, real spending has risen back to its previous
heights within three years.
"And sure enough there are those today who say: ease up,
spend more, borrow more. That would mean debt rising towards 100
percent of GDP - undermining growth.
"It would be a huge mistake and we are not going to let that
happen. Many Chancellors, faced with a recovering economy and
improved borrowing forecasts before an election, would be
tempted to squander the gains.
"I will not do that today. These gains were hard won by the
British people - and we're not going to jeopardise their
HOUSE PRICE RISKS
"I today re-confirm my remit for the Monetary Policy
Committee, including the target of 2 percent CPI inflation -
which the OBR expect will be met this year, next year and in the
"Although the OBR forecast that house prices will remain
below their real-terms peak until at least 2018, I have asked
the Committee to be particularly vigilant against the emergence
of potential risks in the housing market."
"Britain was borrowing 157 billion pounds a year before we
came to office. This year we expect to borrow 108 billion
pounds. That's 12 billion pounds less than forecast a year ago.
"In 2014-15 the (OBR) say it will fall to 95 billion pounds.
Then it falls again to 75 billion pounds in 2015-16, then 44
billion pounds, then down to 17 billion pounds.
"In 2018-19 we won't be borrowing at all. We will have a
small surplus of almost 5 billion pounds.
"Taken together, these new figures mean Britain will be
borrowing 24 billion pounds less than was forecast."
ON OBR DEFICIT FORECASTS
"I can tell the House that the Office for Budget
Responsibility have revised down the underlying deficit in every
year of their forecast. Before we came to office the deficit was
"This year they say it will be 6.6 percent - lower than
forecast and down a third.
"Next year, 5.5 percent - down a half.
"Then it will fall to 4.2 percent, 2.4 percent and reach 0.8
percent in 2017-18. In 2018-19, they are forecasting no deficit
at all - instead, at plus 0.2 percent, a small surplus."
ON OBR GROWTH FORECASTS
"Today the OBR forecast growth in 2014 of 2.7 percent.
That's the biggest upward revision to growth between Budgets for
at least 30 years.
"Growth next year is also revised up to 2.3 percent. Then
it's 2.6 percent in 2016 and 2017. And with the output gap
closed around a year earlier than previously predicted, growth
returns to around its long-term trend, at 2.5 percent in 2018."
"The deficit is down by a third. Now in the coming year it
will be down by a half. But it is still one of the highest in
the world - so today we take further action to bring it down."
"I can report today that the economy is continuing to
recover - and recovering faster than forecast.
"But the job is far from done. Our country still borrows too
(UK economics team)