By ADRIAN LOWCOCK 09/12/2009
We detail some of the highlights of Alistair Darling’s Pre-Budget Report
Economy
The predicted forecast for the economy has been revised to shrink 4.75% in 2009, much worse than 3.5% expected in April.
Growth of 1%-1.5% is expected in 2010, reaching 3.5% in 2011 and 2012.
Borrowing
- 2009 forecast raised slightly, by £3 billion to £178 billion.
- Estimated borrowing of £176 billion in 2010 (a further increase of £3 billion on April’s prediction) and £140 billion in 2011, falling to £96 billion in 2013.
- Budget deficit to be halved by 2013.
- Estimated loss of the bank bailouts fell to £10 billion from £50 billion.
Tax
- National insurance rates to rise by a further 0.5% from April 2011.
- VAT to return to 17.5% from 15% from 1 January 2010.
- One-off 50% tax on bank bonuses of more than £25,000.
- Stamp duty holiday on certain properties to end on 1 January 2010.
- Bingo duty to be cut from 22% to 20%.
- New 50p tax on landline phones to pay for superfast broadband.
Pensions
- Basic state pension will rise by 2.5% in April 2010.
- Child and disability benefit to rise by 1.5% in 2010.
- Contributions to public sector pensions to be cut by £1 billion a year.
- All public sector pay settlements will be capped at 1% from 2011 for 2 years.
Business
- New 10% tax on income from patents to boost science development.
1p increase in corporation tax for small firms to be deferred.