BUDGET

A question - any change in the duty and vat treatment of domestic heating oil??  Anyone know?

Direct tax rates to be indexed to Consumer Price Index from 2012

They overspend, print money, cause inflation, then up our taxes.
God help us if labour get in again

National debt forecast to be 60% of national income this year, rising to 71% in 2012
£100m funding for science facilities (space research)
The country is in debt up to our eyeballs, yet we are going to borrow a little more, so that this critical space research can happen. You could not make it up!

Personal Allowance
All income tax rates for 2011/12 will remain at their 2010/11 levels. The personal allowance will rise to £7,475 and there will also be a £2,400 decrease in the basic rate limit, taking it to £35,000.

They have increased the personal allowance by 1000 and decreased the basic rate limit by 2,400
The 40% tax payers will pay 600 on this, rather than 960.

So, the basic rate tax payers will be 1000 better off and the 40% tax payers will 640 better off.

National insurance
The main and additional rates of national insurance contributions (NICs) will increase by 1% from 6 April 2011 as previously announced. From April 2012, the default indexation basis for all direct taxes, including income tax, NICs, inheritance tax and capital gains tax will move from the RPI to the consumer prices index (CPI). The change will apply for each year from 2012/13, except where there are specific policy commitments to make increases by different amounts, such as the personal allowance.

CPI/RPI Impact
Warning: this is the most pointy-headed blog I've every written.
The change in the indexation of personal tax thresholds is a slow burner that people may only start to notice in the second half of the decade. The initial impact is minimal, but I wonder whether it might become more controversial later.
It is worth considering the impact on national insurance contributions, an unusual tax in that there is not just a lower threshold, but an upper limit beyond which the rate drops to 2% for employees, and nothing for the self-employed.
By changing the increase of the lower limit from RPI to CPI, more income is brought into the NI net (a tax rise compared with what would otherwise have been the case.) But if the same approach is taken at the upper limit (ie the rate of increase is slowed), then people earning above the upper limit see more of their income taxed at the lower rate or, for the self employed, taken out of NI altogether.
This could mean a National Insurance freeze or even a small cut for the wealthy at the time lower earners are paying more.
In fact, the plan is to align the upper limit with the income tax higher rate threshold which, according to Treasury assumptions, will rise in line with RPI, thereby cancelling out the possible benefit to the wealthy.
However, in 2012-13 (the year the shift in indexation comes in), the Chancellor has chosen to freeze the income tax higher rate threshold. The result of that one-year freeze is that when it comes to NI poorer people will start to pay more, but some wealthy people will pay less.
The sums involved are likely to be very small, (I'll ask the IFS later to get an idea), but as the 10p tax debacle showed, sometimes it's not the sums involved that matters, but the perception of unfairness.

http://blogs.news.sky.com/boultonandco/Post:708b87d0-981e-4818-a478-203490049c93