BUDGET 2013: What it means to Derbyshire
The Chancellor of the Exchequor has delivered a Budget that promises good news for the Derbyshire's beer industry, basic-rate taxpayers, the local housing market and distribution firms in the area.
The beer duty escalator was scrapped and duty will be cut by 1p from Sunday, basic-rate taxpayers will either be £112 better off or drop out of the tax band altogether, £3.5 billion has been allocated for shared-equity loans for mortgages while September's planned rise in fuel duty has been ditched.
Chartered accountant Richard Lineham, of Derby firm Cedar & Co, said: “It is good news for all the local breweries and for Marston’s and Molson Coors in Burton. Scrapping a rise in fuel duty – rather than reducing it - in September is good for a county that is important area for distribution. The measures the Chancellor took on Wednesday could help revitalise the construction industry.
“The devil’s in the detail of what comes out further down the line. The way to get the country going is through construction and I’ve never understood why this stimulus did not happen years ago.
“Savings on public services will be spent on providing a stimulus for the private sector without having to borrow more money that we otherwise would have done.”
1.35pm Taking tax off jobs
Mr Lineham: “Up to £2,000 of employer National Insurance won’t have to be paid on new recruits. That starts from April 2014 so it should encourage people to take on more people. This will help small and medium-sized businesses to recruit staff in just over 12 months’ time. I think that this is something that The Derbyshire and Nottinghamshire Chamber of Commerce has been lobbying for and it should help the local economy.”
1.30pm: Planned fuel duty rise scrapped
Mr Lineham: “Cancelling the increase in fuel duty is good for hard-pressed families and it will help the distribution companies of which there are many in and around Derbyshire.”
Beer duty cut by 1p a pint
Mr Lineham: “Beer duty escalator being scrapped is good for this area and cutting beer duty by a penny is even better. That has got to be good news for the local breweries and the big brewers in Burton.”
Mr Lineham: “For 2014/15 tax year income tax personal allowance is going to rise to £10,000 which means £112 per year for a base-rate tax payer. They will either save £112 or drop out of the tax band.”
1.25pm: Help to get onto the housing ladder
Mr Lineham: “These measures will help the building and construction trades – that’s helping a real stimulus to the economy. It means that more people will be able to get the money and might get the housing market to move again. It has been fairly stagnant in this area. If there’s a Government guarantee then that will encourage the banks to lend. It’s good that he’s aiming for both new homes and the second-hand market.”
1.20pm: Flat-rate pension brought forward a year to 2016
Mr Lineham: "This will be good for the people who, at the moment, are not eligible for the full state pension, including many women who spent time outside the workforce. It’s only from that date though. I doubt there will be any interim measures for the period between now and 2016."
1.10pm: Corporation tax to be cut to 20% in 2015
Mr Lineham: “The new 20% rate of corporation tax is described as a tax cut for jobs and growth but that’s just for large companies. It’s already 20% for the majority of small- and medium-sized companies though this measure may encourage larger companies move operations to the UK because we’ll be cheaper than elsewhere.”
1.05pm: Tax incentives for low-emission vehicles
Mr Lineham: “Certainly tax incentives for low-emission vehicles will be of benefit to Toyota in Burnaston but there are no details as to how this will work as it’s rather vague."
1.02pm: £3 billion infrastructure plans
Mr Lineham: “The savings made will result in £3 billion infrastructure plans but it’s from 2015/16 so there’s a delay and little benefit in the next two years and then there’s lead time before spending it.”
1pm: Chancellor criticises the spluge of cash at the end of the financial year
Mr Lineham: “Public sector spending needs to be controlled. Pay increases in the public sector should be in line with the private sector. Cutting pay to save jobs makes sense because if people are still in employment then it means you don’t have to put them through the benefits system which saves the country money.”
12.50pm: Funding for lending scheme, lending from new business bank
Mr Lineham: “They’re trying to put more money in to force banks to lend. What banks have done is take the money to build up their reserves to where they need to be. Every banker says there is money to be had but the criteria for being able to borrow money and the rate are the difficulties.”
12.45pm: Growth forecast halved for next year and borrowing coming down
Mr Lineham: “Continued low interest rates are a double-edged sword because if you’re young with a mortgage, the rates are low but if you’re older relying on savings for income then they are having to eat into their savings because they can’t live on the interest. From a business point of view it’s good to have low interest rates as long as you can borrow from the banks which is not always easy.”
12.40pm: Chancellor believes exports to emerging markets will save us
Mr Lineham said: “The GDP is being hit by people not exporting enough. Banks don’t like lending to those exporting to nations where there is a lot of instability which is a problem for companies in Derby wishing to grow exports.”
12.35pm: The Chancellor announces a Budget for aspirational people who “want to get on”
Mr Lineham said: “There’s very little room for manoeuvre for the Chancellor at the moment. We’ve had cutting Budgets in recent years but businesses are looking for economic stimulus and consumers have been constantly hit with increases in energy prices, fuel costs and VAT at 20%, among other things. People are economising but want to sustain their lifestyles. Lack of cash will inspire some people to work harder.”
12.25pm The Chancellor is expected to start his speech shortly.
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