Transcript
GEORGE OSBORNE
.. will not to transform the finances of any family, but it helps a little to have
some bills that aren't going up and it hel-
DEPUTY SPEAKER OF THE HOUSE
Order! Order! Can I just say to the back row and a couple of people in particular, that the panto
season isn't for another nine months and if auditions do take place can they take place outside the
chamber. Chancellor of the Exchequer.
GEORGE OSBORNE
Mister Deputy Speaker. It helps a lot to be able to keep more of the money you earn before you pay tax on it. This Government support people who work hard and want to get on.
When we came to office the personal income tax allowance stood at under £6500. In two weeks' time, the allowance will reach £9440, with the largest cash increase in its history. Twenty-four million taxpayers will see their income tax bill cut by an extra £200. Over 2 million of the lowest paid will be taken out of tax altogether.
In this Budget, the Government reconfirm its commitment to raising the personal allowance to £10,000, In fact, we go one better. Mister Deputy Speaker. We said we would raise the personal allowance to £10,000 by the end of the Parliament. Today I can confirm that we will get there next year. From 2014, there will be no income tax at all on the first £10,000 of your salary £10,000 of tax-free earning. That is £700 less in tax for working families than when this Government came to office. Almost 3 million of the lowest paid will pay no income tax at all. It is a historic achievement
for this Government and for hard-working families across the country.
I am aware that the concept of a 10p tax rate has caused problems for honourable members opposite. First, they introduced it before deciding that introducing it was a mistake and that it ought to be abolished. Then they decided that abolishing it was a mistake and that they ought to introduce it again. To put them out of their misery, we are going to turn their 10p band into a 0p band, so they do not have to worry about it any more. Every person who is paying at the 10p rate that they doubled will now pay no income tax at all.
There is one final tax change that I want to tell the House about. It is about jobs. In the end, aspiration is about living in a country where people can get jobs and fulfil their dreams. The ending of contracting out that I talked about generates extra employee national insurance revenues for the Exchequer. I want to put those revenues to good use. I want to support jobs and the small businesses that create them, and I want to do it with a reforming tax cut. In fact, it is the largest tax cut in this Budget.
The cost of employing people is a burden on small firms. It is a real barrier to taking an extra person on. To help create jobs and back small businesses in this country, I am today creating the employment allowance. The employment allowance will work by taking the first £2000 off the employer national insurance bill of every company. It is a tax off jobs. It is worth up to £2000 to every business in the country. It will mean that 450,000 small businesses - one third of all employers in the country - will pay no jobs tax at all.
For the person who has set up their own business and is thinking about taking on their first employee, a huge barrier will be removed. They can hire someone on £22,000 a year, or four people on the minimum wage, and pay no jobs tax. Ninety-eight per cent. of the benefit of this employment allowance will go to SME's. It will become available in April next year, once the legislation has passed. We will also make it available to charities and community sports clubs. The last Government's answer to Britain's economic problems was to propose a tax on jobs. We stopped that and today this Government is taking tax off jobs.
A new employment allowance that helps small firms, a 20% rate of corporation tax and a £10,000 personal allowance - major achievements delivered by this Government in difficult times.
We understand that the way to restore our economic prosperity is to energise the aspirations of the British people. If you want to own your own home, if you want help with your child care bills, if you want to start your own business or give someone a job, if you want to save for your retirement and leave your home to your children, and if you want to work hard and get on, we are on your side. This is a Budget that does not duck our nation's problems; it confronts them head on. It is a Budget for an aspiration nation. It is a Budget that wants to be prosperous, solvent and free, and I commend it to the House.
DEPUTY SPEAKER OF THE HOUSE
Thank you. Order! Order! If we are going to make progress, if we want to vote on it, if we want this budget we'd better put the vote. [LAUGHTER] Under the standing order number 51 the first motion entitled, 'provision and collection of taxes' must be decided without debate will the Chancellor of the Exchequer move formally?