George Osborne delivered his third Budget announcing wide reaching reforms to the tax system to reward work and support growth.
His desire is for a fairer, more efficient and simpler tax system based on low headline rates, broader but limiting reliefs and rewarding work and business.
The real surprise in the Budget was the reduction in the headline Corporation Tax rate of 2% from 1 April.
The Budget detail nowadays is included in the acccompanying press releases, however, the other main points were:
• A reduction in the top rate of income tax from 50% to 45% from April 2013
• A limit on all uncapped income tax reliefs. For anyone seeking to claim more than £50,000 of relief, a cap will be set at 25% of income
• An increase in the personal allowance but a freezing and planned withdrawal of the age-related allowances.
• A new rate of Stamp Duty Land Tax (SDLT) of 7% for residential properties over £2 million
• A new rate of SDLT of 15% to all residential properties over £2 milllion purchased by 'non-natural persons' ie companies.
• Extending the Capital Gains Tax regime to include gains on the disposal of UK residential property by non-resident, non-natural persons such as companies
• Consultation on a General Anti-Abuse Rule (GAAR) targeted at artificial and abusive tax avoidance schemes with a view to inclusion in the finance bill 2013
• Correcting anomalies in the VAT system that cause similar products to be taxed differently
• The introduction from April 2013 on a new cash basis for calculating tax for small incorporated businesses
• Providing from 2014/15 a new Personal Tax Statement to all taxpayers detailing the income tax and National Insurance contributions (NIC) together with their average tax rates and how this contributes to the public spending
• The launch of a new detailed consultation on the integration of the operation of income tax and NIC
Our full commentary
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