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The Credit Cruncher was conceived to help you to keep up to date with credit crunch and recession developments, it provides some helpful credit crunch advice and it addresses personal debt. The Credit Cruncher also seeks to explain how the credit crunch started and shed some light on the worldwide recession. Recently, we have begun to look at how BREXIT will affect the UK economy. Please feel free to leave comments where relevant.

22 Jun 2010

UK budget revealed today

VAT to rise by 2.5% to 20% next January - a rise in VAT makes far more sense than Gordon Brown's cut in VAT. Please note that life essentials are not VATable, basic foodstuffs and kids clothes are not taxed - this means that the revenue generated is not made off the backs of the poorest tax-payers. Gordon's cut in tax made absolutley no impression on the poor - it was surely only done to massage inflation figures.

Tax threshold to go up by £1000 - (but this won't come in for another 12 months ) Adding to the tax threshold is to be welcomed, but maybe indicates a less than iron grip (a token gesture which will need recouping elsewhere), and while he was at it, why not take the chance to screw more taxes out of drinkers, gamblers and smokers as well as taking a pot shot at the bankers. (levy to be made on bankers, expected to raise a couple of billion)
(no change to tax on the tobacco and alcohol)

Rising capital gains for higher rate-payers with immediate effect - this should raise a bit of revenue, and no-one is going to defend the rich who are getting their hands on yet more capital... nice move, but a risk of alienating some in the Conservative party...
There will be some capping of housing benefit, and some changes to Child Tax Credit which will affect those earning more than £40,000.

I think this gets the 'well done, but could do better' from me - so early in this governments tenure, it would have been easy to come in hard with an awsome budget that would make a real dent in the deficit, I believe what we have been given maybe a budget that will make a tiny dent in the deficit, meaning that a few more austere budgets will be needed. Every new budget is a step closer to re-election and obviously no-one is going to want to deliver a Mr Nasty budget when there is an election around the corner...

Related Posts
Dec 2009 budget

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