Emergency Budget: Osborne outlines painful cuts
Today’s budget, currently being delivered by Chancellor George Osborne, has bought with it many painful cuts.
Firstly, VAT will be increased from 17.5% to 20% from 4 January, 2011 – this is expected to raise £13 billion a year, according to Osborne.
However, “essentials” such as food, newspapers and children’s clothing will remain exempt from VAT.
Meanwhile, child benefit will be frozen for the next three years. The tough measures are designed to deal with Britain’s record deficit of £155 billion.
Another blow to families comes in the form of tax credits, with those earning more than £40,000 a year to see a reduction.
The massive spending cuts will save Britain from the problems which debt-stricken Greece faces, said Mr Osborne at the weekend.
“Unless we take determined and concerted action, we will find our country on the road to ruin,” he told the BBC on Sunday.
Meanwhile, public sector workers earning more than £21,000 a year would have a two year pay freeze, with those paid less getting a flat pay increase of £250 for the next two years.
From January next year, the Government will introduce a bank tax – designed to claw back billions paid by the state to bailout the financial sector after the financial crisis.
Finally, as expected, council tax will be frozen for one year from next April.
Comments (1)
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you put up vat haw are about putting up
the state pencion to cover our gas electric and water bills and phone
its a good budget but not good for people on state pencions